(Bloomberg) – If European powers are to succeed in holding together a nuclear deal with Iran that the U.S. abandoned a week ago, then one issue they'll need to consider is the insurance of oil tankers hauling the Persian Gulf country's crude.
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From early November, U.S. sanctions will likely prevent members of the International Group of Protection & Indemnity (IGP&I) members from covering the global tanker fleet against risks including spills if they're moving oil to or from Iran, Mike Salthouse, the chair of a sanctions committee for the IG Group, said on Monday.
International Group-backed cover
International Group-backed cover is considered standard in the vast majority of charter contracts for oil shipments because it means everybody in the supply chain knows that many billions of dollars backstop the insurers and reinsurers who'd pay out in the event of a claim. As things stand, it's likely such coverage will be curtailed “or stopped altogether” for Iranian cargoes in November, Salthouse said.
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