Smugglers breaching Iran sanctions at Khor Fakkan

UK ship insurer says oil smugglers breaching US-Iran sanctions at Khor Fakkan
Iranian oil is reportedly being transfered ship to ship at Khor Fakkan in breach of US sanctions
Iranian oil is reportedly being transfered ship to ship at Khor Fakkan in breach of US sanctions

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A UK ship insurer has warned that oil cargoes loaded ship to ship at Khor Fakkan port in the United Arab Emirates may contain Iranian crude listed in documentation as Iraqi barrels.

Insurer West of England said in a letter to members that it cannot insure these volumes as they are in breach of US sanctions on Tehran.

The letter stated that Iranian crude labelled as Iraqi oil was being transferred ship to ship (STS) by smugglers at the Khor Fakkan port in the UAE.

“It appears that such oil may routinely be described as being of Iraqi origin and as having been loaded on board the transferring vessel at Basra some time before the proposed STS operation,” the letter, dated January 13, said.

West of England said it “cannot provide insurance to vessels which load Iranian cargo in such circumstances and cover will cease in its entirety if such cargo is loaded”.

The report comes as US lawmakers, eager for Washington to take a harder line with Tehran on its nuclear program, press ahead with a plan for more sanctions on Iran, with individual US states skirting the federal government to impose their own sanctions.

West of England said that documentation of barrels labelled as originating from Basra in Iraq, and having stopped over at Khor Fakkan, should be thoroughly investigated.

“There is evidence of a sophisticated smuggling operation and those responsible may go to considerable lengths to disguise the true origin of the cargo,” the insurer said.

West of England insures more than 6,000 ships and says Iranian vessels loaded with crude are crossing the Strait of Hormuz to supply ships with oil labelled as originating from Iraq and destined for countries that do not benefit from a waiver of US sanctions legislation.

The transport of Iranian oil without a waiver under US law “may trigger enforcement action against the vessel, its owners and related parties by the US authorities” says West of England.

West of England advised its members “to exercise extreme caution when engaging in STS operations in the Arabian Gulf”.

It also recommended that its members check with port agents to ensure that vessels providing cargo by means of an STS transfer in the region loaded the cargo at the port stated in its documentation.

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