Insurance Deal Allows India to Start Shipping Iranian Crude Again

By MarEx 2012-11-20 15:57:00

Scheduled for loading this Wednesday, an Indian ship will carry Iranian crude oil for the first time since sanctions on ship insurance went into effect earlier this year and significantly reduced Iran’s presence in oil trade.

Mercator Limited, formerly Mercator Lines Ltd., confirms that the tanker is contracted to carry 85,000 metric tons of crude oil for a government refiner, according to a CBS News report.

Local government insurers were being constantly pressured into covering Indian tankers so they could maintain the necessary imports from Iran. However, the government-backed insurance only covers up to $100 million, which is considered inadequate for most Indian shipping firms.

In the rest of Asia, Japan has been proposing $7.6 billion in coverage per tanker to its shippers and South Korean refiners are contemplating allowing Iran to send oil on its own ships.

Photo (thumb): M T Prem Divya [http://www.mercator.in/]