No impact on tankers from Iran sanctions lift
The partial and temporary easing of sanctions against Iran in return for a freeze of its nuclear programme is expected to have no impact on the crude oil tanker market as the deal agreed Sunday does not allow buyers to boost their import volumes from Tehran, market sources have said.
"If no extra crude is being allowed for export, then what impact could it have on the tanker market," an Iranian shipping source said, adding that most of the current exports are anyway being moved on National Iranian Tanker Company ships.
A VLCC shipowner said there could be more cargoes for the VLCC sector, but only if the Iranians are allowed to export crude at "normal volumes."
India, China and South Korea have all been importing their crude on NITC tankers after the EU in July last year banned the provision of EU-linked insurance for any shipments of Iranian crude, regardless of destination.
Most of China's current Iranian oil imports are shipped on NIOC tankers, a representative from NIOC's China office said on the sidelines of a conference in Shanghai last week.
"I would say the bulk of it is shipped on Iranian tankers. NIOC arranges for everything to do with the shipment and the Chinese pay us for it," the source said.
The insurance ban had a wide impact beyond Europe because most key shipping cover across the world was tied back to EU insurers at the time.
But in a ground-breaking deal agreed Sunday in Geneva, the US said it will not pressure countries such as China, Japan and India to make further cuts in Iranian crude purchases over the next six months.
The text of the agreement says the deal will also "for such oil sales, suspend the EU and US sanctions on associated insurance and transportation services."
Japan, which has been using sovereign insurance to ship Iranian crude, will stand to immediately benefit from the easing of sanctions.
"If all parts of the insurance ban are lifted, and we can provide normal protection and indemnity cover, all shipping companies will welcome that," an official at the Japan P&I Club said Monday.