From the Suez Canal to the Strait of Malacca and all choke points in between, Iranian tankers are now a floating liability, U.S. Department of State’s Special Representative for Iran, Brian Hook, said in a press briefing.
Hook argued that now that sanctions have been reimposed on Iran’s shipping sector, Iranian tankers calling at international ports and passing through waterways pose a major risk.
Namely, since the U.S. sanctions also cover the provision of underwriting services, insurance, and re-insurance, Iranian vessels have lost access to insurance on the international market.
As a result, Iran is likely to turn to domestic insurance providers such as Kish P&I. However, Hook believes that the ability of Iranian insurers to cover damages for major losses such as those caused by oil spills would be inadequate.
“Should there be an accident involving an Iranian tanker, there is simply no way these Iranian insurance companies can cover the loss,” he pointed out.
“This is especially important for Iran’s crude oil tankers, which are usually insured for amounts of USD 1 billion or more. (…) Countries, ports, and canal operators, and private firms should know they will be likely responsible for the costs of an accident involving a self-insured Iranian tanker.”
The reference is being made in the wake of a major oil spill caused by the sinking of Iranian oil tanker Sanchi in the East China Sea in January this year, which claimed the lives of 32 mariners.
Furthermore, Hook claims that there are increasing reports that Iranian tankers are switching off their AIS transponders at sea.
” Under international maritime law, vessels have been required since 2004 to use transponders to broadcast their identity and location. Based on credible data, we now know that up to a dozen Iranian tankers have recently disabled their maritime transponders and have effectively gone dark,” he said.
“Turning off these transponders makes tankers harder to track and is a tactic that Iran has used in the past to evade sanctions. In 2012, a majority of vessels in the National Iranian Tanker Company’s fleet turned off their transponders in the run-up to the imposition of U.S. oil-related sanctions. This tactic is a maritime security threat.”
Eight jurisdictions have been temporarily exempted by the Trump administration from US sanctions for importing Iranian oil. The six months period of exemption is granted to China, Greece, India, Italy, Japan, South Korea, Taiwan and Turkey.
The allotments were given because the said parties demonstrated “significant reductions in their crude oil and cooperation on many other fronts and have made important moves towards getting to zero crude oil importation.”