India has offered government-backed insurance for ships carrying crude from Iran to the South Asian country, defying the illegal US-engineered sanctions against the Islamic Republic.
The first Indian ship to carry oil from Iran with Indian insurance coverage is scheduled to load up in Iran on Wednesday, said Kowshik Kuchroo, the president of shipping for Mercator Ltd.
MT Omvati Prem, which will carry 85,000 metric tons of crude oil from Iran, is scheduled to arrive in India by August 25, Kuchroo added.
"This being a government of India cargo, it has a different sense of importance. We're not doing it just for business," Kuchroo said on Monday.
"India is in definite need of the crude. At a short notice, we can't just snap the supply."
Mercator has insured the tanker with USD 100 million from state-owned New India Assurance Company and government-backed United India Insurance.
The state-backed insurance service will help India’s oil refineries secure supplies from Iran.
Iran was the fourth biggest supplier of crude to the South Asian nation in the last Iranian calendar year (ended March 19, 2012), according to the Associated Chambers of Commerce and Industry of India.
On January 23, under pressure from the United States, the EU foreign ministers approved new sanctions against Iran's oil and financial sectors.
The sanctions, which prevent EU member states from purchasing Iran's oil or extending insurance coverage for tankers carrying Iranian crude, came into effect on July 1.
On August 1, the US congress approved more illegal embargoes against Tehran, which seek to punish banks, insurance companies and shippers that help Tehran sell its oil.
The new US embargoes build on Iranian crude sanctions, signed into law by US President Barack Obama and approved in March, penalize other countries for buying or selling Iran’s oil. The sanctions took effect on June 28.