Indian oil buyers are asking Iran to bear the insurance risk for transporting its crude as tighter Western sanctions make it more difficult to buy Tehran's principal export, industry sources said on Wednesday. The number of maritime firms willing to transport Iranian crude has dwindled significantly since the European Union announced in January it would proceed with an oil embargo, leaving Asian oil buyers to rely more on Iranian-owned tankers.
With Indian shipping firms uncertain whether they can continue transporting Iranian oil, state-run Indian Oil Corp and Hindustan Petroleum Corp have written to the National Iran Oil Corp (NIOC) asking the company to take on the insurance risk for their crude shipments, two industry sources said.
NIOC has indicated it may consider the request on a case-by-case basis, the sources said. The United States has also imposed tougher sanctions against Iran for its disputed nuclear programme, prompting Japan and 10 EU nations to significantly cut purchases of Iranian crude oil in order to win exemptions. Washington, however, has left Iran's top customers China and India exposed to the possibility of such steps.
The EU agreed to an oil embargo on January 20 to stop members from importing Iranian oil from July. The embargo also specified a ban on EU insurers and reinsurers from indemnifying vessels carrying Iranian crude and fuel anywhere in the world. Europe's insurers cover the majority of the world's global oil tanker fleet, and the ban could prevent Iran's biggest crude buyers in Asia from importing Iranian crude.