| Iran in bid to foil EU oil insurance embargo |
TEHERAN Iran has come up with several methods to foil the European insurance embargo on ships loaded with its crude, a sanction which may harm its vital exports as much as the EU oil embargo itself.
Strengthening its sanctions aimed at pressuring Teheran to renounce a controversial nuclear programme, the European Union on July 1 implemented a total embargo on the purchase of Iranian oil.
The 27-member bloc also decided to prohibit insurers and reinsurers in Europe, who control 90 per cent of marine insurance in the world, from covering any ship carrying Iranian crude.
The decision has prompted Teheran’s non-European customers, particularly in Asia which absorbs 70 per cent of Iranian crude, to look for improvised alternatives to maintain deliveries.
The International Energy Agency estimates the new sanctions could lower Iranian exports by as much as 40 per cent.
Japan passed a law allowing the state to act as a substitute for European insurance firms in reinsuring tankers which are loaded with Iranian crude, up to $7.6 billion.
But other major customers have not followed suit, forcing Teheran to devise its own alternatives.
China and India have accepted an Iranian offer to transport the crude with its own fleet under all-Iranian insurance. South Korea, which suspended imports on July 1, has not ruled out joining the offer.
But this solution faces several obstacles, apart from transportation price disputes which have broken out with China, according to diplomatic sources.
National Iranian Tanker Company (NITC), with 40 tankers of 100,000 to 300,000 tonnes, does not have the long-distance capacity for more than 2 million barrels a day in exports by pre-sanctions Iran, a European expert said.
Moreover, a number of these vessels were being used in June to store Iranian offshore crude that Teheran has not been able to sell because of the sanctions, according to specialists.
Iran has announced plans to quickly expand its onshore storage capacity, which has been saturated, including by subcontracting to private firms. Teheran has also ordered 12 new supertankers from China and should receive the first in December.
Agence France-Presse
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