The waters of the Bay of Lakonikos, on the south-eastern side of Greece’s Peloponnese peninsula, are a bright turquoise color. Its shores are an important nesting site for sea turtles. Yet it’s not just a place of natural beauty. The area has become a key hub for tankers carrying Russian energy exports. As crude and refined petroleum products that would usually go to the European Union are rerouted to Asia — with most seaborne oil imports banned by the bloc in response to Moscow’s assault on Ukraine — cargoes are being transferred here onto larger vessels to make the long trip. Ship-to-ship transfers of Russian crude have mushroomed in recent months, reaching a record high during the first three months of the year, according to data from S&P Global, a research firm. Near Greece, more than 3.5 million barrels of Russian gasoil, a refined product used in heating and transport systems, were transferred between ships in March. That’s more than seven times the volume tallied by S&P Global for that month in 2022. The transfers highlight the dramatic transformation of the global oil market since President Vladimir Putin ordered a full-scale invasion of Ukraine nearly 14 months ago. As China, India and Turkey fill the void left by Europe, once the top buyer of Russian oil and oil products, trips have lengthened, requiring more ships — and S&P Global data indicates mid-journey handoffs have become more common. “We’ve seen a big increase in ship transfers in the Mediterranean,” said Matthew Wright, senior freight analyst at Kpler, a data group. “Smaller vessels come in from Russian ports, they transfer the cargoes onto larger vessels, and then those larger vessels will head off to Asia.” Many of these ships are part of what’s become known as the “gray fleet.” Industry insiders like Wright use this term to refer to vessels that started carrying Russian oil in the past year. For many, little is known about their owners, which may be a shell company. The “gray fleet” isn’t necessarily doing anything underhanded. But Western observers like Wright say the emergence of this network, where ownership is often masked, has reduced transparency in the oil market, making it harder for regulators to keep watch. Australia, Canada and United States recently said in a submission to the International Maritime Organization that more ships were illegally turning off their transponders, or “going dark,” before transferring oil in international waters. Switching off transponders, which transmit location data, can be a way of dodging sanctions, they said. Fred Kenney, the IMO’s director of legal and external affairs, told CNN that alarm about this practice had grown over the past year. Collisions are more likely in such cases, raising the odds of a devastating oil spill. It’s also harder to tell whether the vessels with murky ownership comply with the strict rules governing oil transfers at sea, according to Kenney. “There is a significant level of concern that the regulatory regime that ensures safe and secure shipping on clean oceans is being undermined,” he said. A shadowy business Russia’s oil export volumes have rebounded to levels last seen before it invaded Ukraine, according to the International Energy Agency, although the country is still grappling with a sharp drop in revenue from these exports. Group of Seven nations have imposed a cap on the price of Russian oil and oil products, and a smaller pool of buyers can also negotiate greater discounts. China’s imports of Russian oil in the first quarter of the year rose 38% compared with a year prior, according to Kpler data. India’s have skyrocketed almost tenfold. As trade of Russian oil has become more complex, many Western shippers have pulled back. New, more opaque players have stepped in, contributing to the formation of the “gray fleet.” According to VesselsValue, a UK-based market intelligence firm, sales of oil tankers to newly formed companies or undisclosed buyers account for roughly 33% of tanker deals so far this year. Sales to unknown buyers accounted for just 10% of the total in 2022 and 4% in 2021. Tracking a ship Using satellite images from space technology firm Maxar, CNN was able to home in on pairs of oil tankers dotting the Bay of Lakonikos. Together with Kpler, CNN has worked out the details of one of the transfers. According to data from the two ships’ transponders, the smaller tanker docked in St. Petersburg, Russia, where it picked up a cargo of fuel oil in late February. CNN then tracked it around Western Europe to the Mediterranean Sea. At that point, it unloaded its cargo onto the larger ship that had arrived from the direction of the Black Sea port of Novorossiysk in Russia. Kpler considers this vessel to be part of the “gray fleet.” From there, the larger tanker continued through the Suez Canal, the primary sea route from Europe to Asia. As transactions such as these become more common, experts are growing increasingly worried about the risks. While transferring oil from one ship to another is not unusual, Kenney of the IMO said “gray fleet” ships — more difficult to monitor if it’s not clear who owns them — might not be following best practices. “There [are] myriad things that can go wrong in a ship-to-ship transfer, which is why there is a comprehensive set of industry rules that govern these transfers,” he said, noting the potential for a spill. Canada, Japan and the United Kingdom have pointed out that there is a higher risk of accidental collisions between ships if transponders are turned off. Kpler documented multiple instances of this practice, which is almost always illegal, in 2022. “When we see ships, or we get reports of ships turning off their transponders, it’s concerning to us,” Kenney said.