India has extended a three-month approval to Iranian underwriters Kish P&I and Moallem Insurance Co for insuring ships and oil tankers calling at Indian ports, two shipping sources familiar with the development said.
A delay in renewing the approval had disrupted oil and container trade between Indian and Iran, with some ships stranded outside ports in both countries.
The new approval is valid until Dec. 27, said the sources, who had received a letter from the Directorate General of Shipping. The previous approval had expired on Sept. 27.
"This will facilitate Iranian (oil) shipment," said P.P. Upadhya, managing director of Indian refiner Mangalore Refinery and Petrochemical Ltd.
India's intake of Iranian oil through August in 2013 was down over 40 percent on the year. International sanctions aimed at curbing Tehran's nuclear programme have made it difficult to insure refineries and ships involved in the trade and forced some oil payments to be made in rupee.
India receives crude imports from Tehran in Iranian vessels, while exports of non-oil commodities and industrial goods use the vessels of Iran's Hafiz Darya Shipping Lines (HDS) and Safiran Payam Darya Shipping Lines (SAPID).
EU sanctions against Iran from mid-2012 bar members of Europe's International Group of Protection and Indemnity (P&I) Clubs - which accounts for the majority of cover for the tanker market - from insuring Iranian oil and other shipments, leading to the emergence of untested insurance providers.
Reporting by Nidhi Verma; Editing by Tom Hogue (C) Reuters 2013.