RUSSIA’S former president has seemingly pledged state guarantees to replace commercial insurance and reinsurance cover of oil exports by sea and the vessels that carry them in a bid to counter the European Union ban on companies providing services.

Dmitry Medvedev, deputy chair of Russia’s security council, made his comments on social media platform Telegram, without giving details of how such an arrangement might work.

The development comes after European Commission president Ursula von der Leyen confirmed long-trailed plans to target Russian crude, in retaliation for that country’s incursion into Ukraine earlier this year.

The formal wording of the proposals, informally known as ‘the sixth package’ — because they represent the sixth round of sanctions against Russia — is on the EU website.

Marine insurers are currently in the process of unpacking what is a lengthy document in order to see exactly what is required of them, but are already complaining that the language used is sketchy and difficult to understand.

The International Group of P&I Clubs is currently discussing the matter with the EU and could issue guidance to its 13 affiliates within days.

“This problem can be solved,” Mr Medvedev said. “The issue of supply insurance can be closed at the expense of state guarantees within the framework of interstate agreements with third countries. Russia has always been a responsible and reliable partner, and it will remain so in the future.”

Ever since the insurance ban was first raised, marine insurers have suggested that the obvious workaround would be for tanker owners willing to lift in Russia to seek a first line of cover from Ingosstrakh, a state-owned Russian insurance with a sizeable brown water domestic P&I and hull book already.

After that, the Kremlin would need to backstop levels of cover similar to the $2.1bn available from P&I clubs, thanks to additional layers made possible through the International Group pooling scheme and its captive and reinsurance mechanisms.

So far, this has been speculative surmise. But if Medvedev’s pronouncement could indicate that the Russian government is thinking along such lines.

The sanctions package itself was broadly in line with what marine insurers were expecting.

“It is appropriate to prohibit the import, purchase or transfer into member states of crude oil and certain petroleum products from Russia,” the document said. “Moreover, it is appropriate to prohibit the insurance and reinsurance of maritime transport of such goods to third countries. Appropriate transitional periods should be provided for.”

There is an express ban on the direct or indirect provision of technical assistance, brokering services or financing or financial assistance, related to the transport, including through ship-to-ship transfers, to third countries of crude oil or petroleum products which originate in Russia or which have been exported from Russia.

There is also a prohibition on the purchase, import or transfer into member states, directly or indirectly, of crude oil and certain petroleum products, which originate in Russia or are exported from Russia, and on the insurance and reinsurance of maritime transport of such goods to third countries.

There will be an appropriate wind-down period, most likely to be six months, in line with earlier packages.

Mike Salthouse of North Group, who chairs the IG’s sanctions subcommittee, said that the package was pretty much what been expected and did not contain any surprises.

“Russian oil in various forms will be banned within a period of six months or so, and that will include EU ships and insurance companies subject to EU jurisdiction. It was widely trailed beforehand what would happen and the long wind-down period was also quite widely trailed.”

Lars Lange, secretary general of the International Union of Marine Insurance, said his organisation supported sanctions against Russia in principle, given its aggression against Ukraine.

“We will do as an industry our utmost to comply with any sanctions imposed on insurers. But we urge clarity, so that we can understand what is allowed and what is not allowed,” he said in an email, adding many individual insurers have in any case decided on a company level to self-sanction, and will if anything over-fulfil EU stipulations.

The widespread expectation is that the UK government and other non-EU jurisdictions will follow the bloc's move with insurance bans of their own, if only by way of a symbolic united front, with little additional impact.

The wording of the UK sanctions may diverge slightly from the EU wording. But this will be largely for presentational reasons, at a time when London and Brussels are at post-Brexit loggerheads over the Northern Ireland protocol.

The Lloyd’s and London companies markets, UK-based P&I clubs and Norway’s Gard and Skuld are the dominant players in European marine insurance, and all are formally outside the EU.

But as a consequence of Brexit, Lloyd’s and the clubs both write European marine business via subsidiaries domiciled in member states, and will have to comply.

Likewise, Norway’s special relationship with the EU means that its government mandates Norwegian entities to follow EU sanctions as a matter of course.