Sanctions Impact Estimator

Overview

This pillar models the effective supply reduction of commodities caused by geopolitical sanctions. It moves beyond official announcements to quantify real-world trade disruptions, providing a more accurate view of supply shocks.

What It Does

The estimator analyzes official sanction regimes, then contrasts them with data on illicit trade and sanctions evasion tactics, like shadow fleet activity. It calculates a net 'effective supply reduction' figure, which often differs significantly from headline numbers. This provides a quantitative measure of a sanction's true bite on the market.

Why It Matters

Markets often misprice the impact of sanctions, either by overreacting to announcements or underestimating a nation's ability to evade them. This pillar provides a data-driven edge by revealing the gap between stated policy and actual commodity flows, identifying undervalued or overvalued assets.

How It Works

First, the pillar ingests data on new and existing sanctions from official government sources. Second, it analyzes satellite and shipping data to identify and quantify shadow fleet movements and other evasion methods. Finally, it combines these datasets to calculate a net supply impact, adjusting the sanctioned volume by an estimated evasion percentage.

Methodology

The core calculation is: Effective Supply Reduction (%) = (Total Sanctioned Volume * Enforcement Score) - Estimated Evasion Volume. The Enforcement Score (0-1) is a proprietary metric based on the historical actions of the sanctioning body. Evasion Volume is estimated by tracking AIS transponder gaps, ship-to-ship transfers, and discrepancies between export and import data over a rolling 90-day window.

Edge & Advantage

It quantifies sanctions evasion, providing a more accurate supply picture than models that simply take official government announcements at face value.

Key Indicators

• Shadow Fleet Activity

  high

  Measures tanker movements with disabled transponders, unusual routes, or a history of illicit transfers, indicating evasion.

• Export Volume Discrepancies

  high

  Compares a sanctioned country's reported exports with the import data from its trading partners to find inconsistencies.

• Sanction Enforcement Announcements

  medium

  Tracks official statements and punitive actions by bodies like the U.S. Office of Foreign Assets Control (OFAC).

Data Sources

• U.S. Treasury OFAC

  Official source for U.S. sanctions lists and enforcement actions.

• Kpler

  Provides commodity data intelligence, including real-time cargo tracking and trade flow analysis.

• TankerTrackers.com

  Independent online service that tracks and reports on oil shipments, specializing in sanctioned countries.

Example Questions This Pillar Answers

• → What will be the total volume of Russian seaborne crude oil exports in Q4 2024?
• → Will the price of aluminum surpass $2,500 per ton if new sanctions are placed on a major producer?
• → Will Iran's effective oil exports be over 1.5 million barrels per day next month?

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