Oil insurance sanctions still affecting South Korean Iran crude imports

oil insurance

The country had imported 1.97 million barrels per day throughout the month of August.

The latest reports regarding the impact of the oil insurance sanctions from the west on Iran regarding the crude that leaves that country’s shores have indicated that South Korea did import 1.97 million barrels per day of Iranian crude throughout the month of August.

When compared to the figures from August 2012, this is notably higher, only because the country imported nothing.

The oil insurance sanctions had only just gone into effect at that time last year and South Korea was importing absolutely no crude from Iran during that month. This makes it seem as though the year over year imports of crude had increased dramatically, but when put into context, it is still quite low.

oil insuranceIn fact, total crude imports are still much lower than they normally would be because of the oil insurance bans.

The total crude imports are down 12.6 percent, year over year, from Iran. They were drooping at about 70.3 million barrels in August. This data was released by the Korea National Oil Corp., a state run organization.

South Korea, India, and China, as well as other importers of Iranian crude, had all agreed to reduce their purchases from Iran in order to solidify a renewal on the six month waiver on the American oil insurance sanctions that are directed specifically at reducing the income that Iran can earn and, therefore, direct toward its controversial nuclear program.

The oil insurance sanctions have been causing considerable struggles for countries that have sought to import crude from Iran because the majority of insurers and reinsurers for tankers and refineries are located in the West, primarily in Europe, which is also participating in the bans.

The imports of crude vary greatly from one month to the next. In July, for example, despite the oil insurance bans, the imports of Iranian crude by South Korea had experienced an unexpected spike when compared to the year before. It is more difficult to compare August and September (when that data becomes available) because South Korea did not make any imports at all, last year, resuming their purchases in October 2012.

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