Reuters: Iran's Covert Efforts to Utilize Foreign Oil Tankers

Reuters reported that Iran is secretly searching for second-hand foreign oil tankers to replace its aging shipping fleet for oil exports. According to the report, which was compiled on Wednesday, March 13, based on statements from Iranian and foreign industrial sources, negotiations between Iran and South Korea to purchase 10 tankers have stalled since the U.S. withdrawal from the JCPOA in May. Panama has also removed at least 21 Iranian tankers that were operating under its flag in international waters from its ship registry, and Iran is attempting to replace the Panamanian flag with those of other countries like Vietnam. Reuters cited sources stating that likely over 60 Iranian vessels, including tankers, were registered in Panama. Under U.S. sanctions, the provision of insurance and port services to Iranian tankers is restricted. To evade these sanctions, Iran has registered some of its tankers abroad, operating under the flags of other countries, a topic that has recently been raised in the media, and the U.S. has announced that Panama will no longer allow the use of its flag for Iranian tankers. Oil accounts for 70% of the Islamic Republic's revenues, and the U.S. has exempted eight countries to continue purchasing Iranian oil in a 'limited' manner until next May. Iran is striving to mobilize all its resources for oil exports. Recently, Bijan Namdar Zangeneh, Iran's oil minister, stated that significant efforts are being made to circumvent sanctions and continue oil exports, but he refrained from providing details to prevent 'U.S. exploitation.' Reuters adds that after the sanctions on the Greek-registered tanker fleet in the first round of sanctions (2012 to 2016) by the U.S., foreign companies and countries are wary of registering Iranian tankers. Iran's crude oil exports are currently around one million barrels, which is more than half lower than before the U.S. withdrawal from the JCPOA. Israel recently announced that its navy would prevent oil smuggling and sanctions evasion by Iran. During the first round of sanctions, Iran employed various methods to circumvent sanctions and secretly sell oil, including changing ship flags, names, colors, registering in other countries, turning off tanker tracking signals, and transferring oil to other tankers in international waters. Reuters states that since then, technical equipment for tracking ships has advanced significantly, and the U.S. is closely monitoring Iran's oil exports and the networks that assist the Islamic Republic. The report cites experts stating that large tankers avoid receiving and transporting Iranian oil, and even China is trying to strictly adhere to U.S. sanctions. An unnamed Iranian official told Reuters that contrary to claims, many countries are happy to cooperate with Iran. 'Iran has previously had experiences overcoming sanctions, including using tankers from other countries.' Another Iranian official told Reuters that Iran had begun negotiations with South Korea to acquire 10 large tankers, each capable of transporting 2 million barrels of oil, but sanctions hindered the continuation of this deal, although negotiations are still ongoing. Reuters reports that Iran and South Korean companies Daewoo Shipbuilding and Marine Engineering began negotiations after the JCPOA to form a joint company to establish a shipbuilding factory in Iran. A Daewoo spokesperson told the news agency that a memorandum of understanding was signed in 2016, but negotiations have not progressed, although an Iranian official told Reuters that discussions are ongoing. A source told Reuters that Iran is also looking towards a network in Greece to solve its tanker problems. The Islamic Republic has over 50 large tankers, some of which are old. According to data from international companies, about one-fifth of these tankers are used solely for storing unsold Iranian oil. Sixteen Iranian tankers are over 19 years old, and three Iranian tankers have been operational since 1996.