GMS, a prominent buyer of ships and offshore vessels for recycling, has obtained the first U.S. permit allowing the purchase of vessels sanctioned due to ties with Iran. The permits, issued in April, enable the scrapping of four container ships: Yogi, Timon, Rantanplan, and Bigli. These vessels were identified in a Treasury Department notice that outlined extensive sanctions against those associated with Hossein Shamkhani, a notable figure with connections to Iran’s past leadership.
Shipowners and recyclers like GMS have voiced concerns over the lack of a secure and legal process to remove older, poorly maintained ships from the so-called shadow fleet, which continues to operate despite sanctions. GMS CEO Anil Sharma suggested that if more such permits are granted, it could facilitate the removal of additional sanctioned vessels, thereby reducing the capacity for carrying sanctioned oil.
The shadow fleet has notably expanded since Russia’s invasion of Ukraine, transporting oil from Iran, Russia, and Venezuela. Despite sanctions, this fleet has proven resilient, often utilizing ships that are far beyond their typical retirement age. GMS is proceeding with the acquisition process but faces caution from banks and buyers due to the ongoing sanctions. The company has requested the Office of Foreign Assets Control (OFAC) to remove the vessels from its blacklist.
