Asian oil refiners are shunning a major export grade from the Russian Far East due to sanctions on a tanker company that ships the cargoes.

Buyers are now trying to back out of purchases of Sokol, which was sold out for May-loading two weeks ago, said people with knowledge of the matter. At least one shipment of the variety for loading in end-May has been canceled, with several other refiners trying to wind back purchases for June, said the people who asked not to be named due to the sensitivity of the information.

Sokol is being avoided due to the involvement of Sovcomflot PJSC, a Russian state-controlled firm that transports the crude produced at the Sakhalin-I project from the De-Kastri export terminal to customers in North Asia. The company’s tankers are struggling to get insurance from international firms after it was added to a list of U.K.-sanctioned entities, the people said.

While many Asian refiners have stepped in to buy Russian oil after it was shunned due to the invasion of Ukraine, the episode illustrates they still need to be careful. Marine insurance is critical for the buyer as well as other shipowners as it provides protection from legal liabilities such as damage to cargoes, collisions and oil spills. A lack of coverage could lead to lawsuits and subject counterparties to hefty losses in the event of an accident.

Exxon Mobil Corp., which operates Sakhalin-I on behalf of an international consortium of Japanese, Indian and Russian companies, didn’t immediately respond to an email seeking comment. The U.S. oil major is seeking to exit the project. A Sovcomflot spokesperson declined to comment.

It’s unclear what will happen to the canceled cargoes. They could be re-offered via closed tenders or stored in onshore tanks. Sokol shipments scheduled for loading in May were sold to buyers across China, South Korea, Japan and India. Russia’s biggest state oil producer Rosneft PJSC failed to award a tender to sell millions of barrels of Urals crude this week.

The Sakhalin-I Sokol stream is one of Russia’s main export grades alongside Urals and ESPO. The variety is popular with refiners in North Asia, Hawaii and even Australia as it produces large quantities of diesel when refined. The crude can travel from De-Kastri to major refining hubs in China and South Korea in just three to five days.

Sovcomflot provides tankers for the Sakhalin-I project as part of a long-term agreement. The shipowner’s vessels load the crude from De-Kastri and carry it to destinations in North Asia. Buyers from further afield need to charter other tankers, which conduct ship-to-ship transfers off South Korea.

The trading of Russian oil is becoming more clandestine due to restrictions over the war in Ukraine. Vitol Group, the world’s biggest independent oil trader, has said that it will stop dealing with Russian crude by the end of the year, while majors such as Shell Plc and Exxon Mobil Corp. are working on divesting their investments and withdrawing from the country.