Tuesday, April 17, 2012

Lack of Insurance Could Halt Iran Oil Trade

Reuters reports:

Marine insurance, or lack of it, may yet turn out to be the most effective sanction used by Western nations in 17 years of tightening the screws on Iran's nuclear program.

A European Union oil embargo on Iran, set to take effect in July, prohibits EU insurers from covering Iranian oil exports anywhere in the world. With around 90 percent of the world's tanker insurance based in the West, the arcane world of reinsurance and liability coverage has become a powerful weapon.