Despite the West’s sanctions on Iranian oil, Indian shipping firms continue to transport the crude. The United States and UK have imposed sanctions on Iranian oil (as the petrodollar is suspected to be funding Tehran’s nuclear weapons development), which has affected marine insurance companies. The western sanctions have spread to insurance companies who have been ordered not to cover cargo ships transporting crude from the Middle Eastern country, and Japanese insurance companies followed suit. India, however, has decided to continue covering ships with Iranian oil.
The lack of coverage on the ships leaves transporters, buyers and sellers financially responsible for spillage and accidents. The move attempts to reduce the amount of petrodollars going into the country. Shipping Corp of India, Great Eastern and other Indian tanker firms have requested state insurance companies to provide third party cover for tankers up to $50 million per voyage. The sanctions on Western insurance companies open up shipping firms to suffers losses even as a result of war.
To read the full report, visit Reuters.