The announcements came just hours after the Indian daily The Hindu said Iranian tankers could not enter Indian waters because of US sanctions. The Hindu quoted the head of Mangalore Refineries and Petrochemicals Limited as saying India’s government had withdrawn insurance cover for three Iranian tankers scheduled to bring Iranian crude to it.
A few weeks ago, Iran said it was insuring its own tankers carrying Iranian crude to foreign clients.
The announcement Saturday said it would expand that coverage to Iranian crude carried on foreign-owned tankers. The insurance would be made possible through a new multi-billion-dollar line of credit made available by the Iranian state, Iran’s representative to OPEC, Mohammad-Ali Khatibi, said.
He failed to say what size of fund was made available and what scale of insurance would be offered, crucial questions. Foreign tanker owners were likely to be suspicious of Iran’s willingness to pay a multi-billion-dollar claim if the funds were not accessible outside Iran.
Shipments from countries such as India and South Korea stopped completely after July 1 because EU sanctions bar European insurance firms from insuring or re-insuring Iranian cargos. While lots of insurance is available around the world, almost all re-insurance is done by firms based in Europe and subject to the EU rules.
A large tanker is normally insured for around $2 billion. Most of that is insurance against claims if the tankers should be damaged and spill large quantities of oil.
Japan is thus far the only country that has enacted a plan to re-insure its own tankers carrying Iranian crude.