China will ensure tankers can haul Iran oil

 
Bloomberg News
Updated 3/16/2012 6:46 AM

China, the biggest buyer of Iranian oil, will take steps to prevent European trade sanctions disrupting shipments from the Persian Gulf nation, said tanker operator China Shipping Development Co.

The government has discussed ways of helping shipping companies get insurance once sanctions against Iran kick in on July 1, General Manager Yan Zhichong told reporters in Hong Kong today. The ministry of transport and National Development Reform Commission has had special meetings on the issue, he said.

                                                                                                                                                                                                                       
 

"The attitude is clear -- we must make sure that the volume of our shipments will not drop," Yan said. "The government regards it as a very important issue."

China may nominate an insurer to cover oil shipments from Iran to ensure that supplies can continue, Yan said. European Union sanctions on Iran threaten to disrupt oil shipments because about 95 percent of the world's tankers are insured against risks such as oil spills by the 13 members of the London-based International Group of P&I Clubs, according to Andrew Bardot, its secretary and executive officer.

China Shipping Development had a fleet of 72 tankers at the end of last year. The company is part of state-controlled China Shipping Group Co., the nation's biggest sea-cargo carrier after China Ocean Shipping Group Co.

China Shipping so far hasn't had any disruptions in its cargos from Iran, Yan said. The Asian nation is underwriting some oil shipments, according to the International Energy Agency.

About 22 percent of Iranian oil exports go to China, according to U.S. Department of Energy estimates. The Asian nation opposes trade restrictions against Iran and said oil sanctions aren't "constructive," the official Xinhua News Agency reported Jan. 26, citing comments from the Ministry of Foreign Affairs.

The European Union and U.S. have imposed sanctions on Iran because of the nation's nuclear program. Iran has said that the project is just for civilian use.

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