TOKYO: Japan started providing up to Yen 877.8 billion ($7.98 billion) shipping insurance cover for tankers carrying Iranian crude for fiscal year 2015-16 (April-March), amid uncertainty over Western sanctions against Iran.
Japan’s insurance cover for Iranian oil is at a record level in 2015-16, up almost 15% from Yen 764.4 billion ($7.88 billion) in fiscal 2014-15, due mainly to a weaker yen against the dollar.
The Minister of Land, Infrastructure, Transport and Tourism Akihiro Ohta signed a contract Wednesday with one Japanese shipowner to provide insurance to one of its VLCCs carrying Iranian oil, a ministry official said.
It was not immediately clear when this VLCC will load Iranian oil.
In order to get the government-funded shipping insurance scheme, Japanese shipowners need to sign contracts with the transport minister for every VLCC the companies use to carry Iranian oil. Japan’s shipping insurance for fiscal 2015-16 took effect after parliament passed a provisional budget for the fiscal year on March 30, after it promulgated a revision to its law on March 27, the official said.
The start to Japan’s shipping insurance scheme for Iranian oil this year comes against the backdrop of Tehran and the P5+1 world powers continuing their negotiations over Iran’s disputed nuclear program, with a possible framework deal as soon as later Wednesday.
