India asks Iran to insure own oil

Business Materials 1 March 2012 17:35 (UTC +04:00)

Azerbaijan, Baku, March 1/ Trend M. Moezzi

India has asked Iran to insure its own oil shipments, Fars has reported.

India worries its oil companies will be sanctioned by the U.S. and Europe for doing business with Iran.

Another option for India is to guarantee its refineries' credit as they continue to import Iran's oil. The EU has imposed sanctions against transporting, insuring and financing Iranian oil shipments.

This will be to the disadvantage of Asian countries because 95 percent of the world's oil tankers get their insurance coverage through the 13 companies who are members of the London-based International Group of P&I Clubs. Up to now India's refineries were directly responsible for insuring their oil shipments from Iran.

The U.S and EU have ratcheted up sanctions against Iran. They have embargoed Iran's oil industry and petroleum products and the U.S. is pressuring other countries to stop doing business with Iran.

In late January, the EU's foreign ministers agreed to stop buying oil from Iran after current contracts run out by July 1.

The West's measures are part of an effort to make Iran answer questions about its nuclear program which it says is peaceful and civilian in nature while the U.S. and its allies contend it is not.