Analysis: Oil Market Shrugs At Imminent Iran Tanker Insurance Ban -- Reuters
In less than two weeks, Iran's biggest oil buyers will lose access to the London-based insurance market that protects 95 percent of the world's tanker shipments against oil spills or catastrophic collisions.
Barring an unexpected last-minute deal to relax European Union sanctions, Europe's Protection and Indemnity (P&I) clubs will be unable to insure vessels carrying Iranian crude from July 1, an unforeseen but ultimately critical side effect of EU sanctions to punish Iran for its nuclear program.
In an extreme scenario, exports from OPEC's second-largest supplier -- already curtailed by separate U.S. sanctions and an EU import ban -- could grind to a halt next month as overseas oil companies cannot afford to take the risk of multibillion-dollar liabilities arising from an uninsured incident.
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My Comment: It looks like the Japanese government will need to get into the insurance business .... and hope that a disaster will not strike one of their insured oil tankers.
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