EU Bans Insuring Tankers Carrying Iranian Crude Effective 1 July
South Korea became the first major Asian consumer of Iranian crude to suspend its imports starting July 1. The government announced that the move was in response to a EU ban on insuring tankers carrying Iranian oil. Iran supplied more than 9 percent of South Korea’s crude in 2011, its fourth largest customer. (Reuters)
The South Korean decision to halt all crude shipments from Iran differs from strategies chosen by Japan, India and China. In the Japanese case, the government has offered state guarantees to its refiners importing uninsured crude shipments from Iran, practically insuring the shipments. India and China, the other two major Asian importers, will allow Iran to deliver the crude by its own tankers with the shipments insured through Iranian government-owned companies.
Japan, India and South Korea have been granted temporary waiver from U.S. sanctions because they each have reduced their current oil imports from Iran by at least 20 percent. China, the largest importer of the four, has not reduced its imports and has not recognized the legality of the U.S. imposed sanctions.