Iran Sells Oil to Japan & China
By Micah Halpern
Thursday June 21, 2012
I've Been Thinking:
Japan and China have found their way around the problem of importing Iranian oil. South Korea and India are trying to do the same.
The biggest issue they have to contend with is how to cover the insurance of ships carrying Iranian oil. As of July 1, 95% of all oil tankers shipping oil from Iran will lose that coverage because they have been insured in Europe. The total embargo begins in 2 weeks.
The Japanese parliament has allocated $7.6 billion to cover any loss. China has said that they are comfortable with Iran using its ship to transport the oil. Those two countries are the biggest market for Iran totaling 620,000 barrels a day. The breakdown is 120,000 for Japan and 500,000 for China. China does not want to be totally dependent on Saudi oil so it is essential to keep Iranian oil flowing. Japanese import of oil rose 7% this May as compared to May 2011.
The estimated breakdown for June and July from last year to this year is exactly the same.
The most important point is that there are ways around the embargo and Japan and China have already found them while India and South Korea are still seeking ways to import Iranian oil. Where there is a will, there is a way.
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