The UK relaxes sanctions against Russia

London has resumed allowing the sale of insurance for aeroplanes, ships, and the parts that make them to entities with ties to Russia.

In response to the escalating turmoil in Ukraine, London has loosened some of the limitations it had placed on Russia, allowing businesses to offer insurance and reinsurance to organisations with ties to Russia. The UK Department for International Trade announced the modification to the "General Trade Licence Russia Sanctions - Vessels" on Monday.

According to a brief statement from the department, "The General Licence has been changed to remove Regulation 28 (financial services and money relating to restricted items and restricted technologies) from paragraph 1(h)."

According to the document's further information, "this authorises the provision of insurance and reinsurance to a person linked with Russia in respect to the items in paragraph 1(a), subject to the wider limits and requirements of the licence. The aforementioned sentence refers to both seagoing vessels and aircraft, their elements, and aviation gas turbine engines.

The restrictions, which were largely intended to harm Russian oil commerce, have reportedly been suspended because of concern that they will drive up crude prices and further jeopardise international energy security. According to Patrick Davison, underwriting director of the Lloyd's Market Association, a trade association for insurers at Lloyd's, "there is no present UK prohibition affecting global shipments of Russian oil."

The existence of the EU limitations "may well impair enthusiasm for Russian oil supplies in London," he said in a statement to the Financial Times on Sunday. "Given the global character of the [re]insurance industry."

The EU took similar action last month to loosen sanctions against Russia. On July 21, the EU Council approved the transactions required for state-owned oil corporations in Russia to sell their products to foreign nations.

The EU decided to extend the exemption from the prohibition to engage in transactions with specific state-owned entities as regards transactions for agricultural products and the transport of oil to third countries, the Council stated at the time, "to avoid any potential adverse consequences for food and energy security around the world."

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