U.S. Sanctions on Russia: Impact on Shipping Business and Contractual Considerations
The shipping sector is fundamental to international trade in a global economy that is more interconnected than ever. In response to the Russian invasion of Ukraine, the United States, European Union (EU), United Kingdom (U.K.) and many other countries have imposed severe sanctions on Russia and Russian entities. In particular, the U.S. government is well aware of, and using to great effect, the reliance of international shipping trade on the U.S. financial system and the U.S. dollar, to punish Russian aggression. The U.S. dollar serves as the leading global currency. It is intricately linked to countless transactions across the marine industry and permeates countless aspects of shipping. It has also become central to the primary U.S. “soft power” enforcement tool of choice in response to Russia’s unprovoked military invasion of Ukraine. Specifically, in recent weeks the United States, along with other allies, have imposed multilateral sanctions and export control restrictions against Russia and Russian entities through a barrage of actions, with additional sanctions promulgated almost on a daily basis.