The U.S. rig count dropped…
The relationship between Kyrgyzstan and…
The oil tanker traffic jam in the Bosphorus and Dardanelles Straits is growing, the Tribeca shipping agency told Reuters on Friday.
The number of oil tankers idling in the Bosphorus and Dardanelles Straits waiting to enter Turkish waters has swelled to 28 as of Friday, compared to 20 on Monday.
Before they can move on, Turkey requires all oil tankers to show proof of proper insurance coverage for their cargo, in light of the recently implemented G7 oil price cap on Russian crude.
Turkey’s requirements come despite Western assurances that not every crude oil tanker should have to prove that it has proper coverage. The insurance checks are creating extensive delays in shipping, and is worrying not only crude oil buyers, but Russia as well.
Part of the worry is that Western insurers are saying they are unable to provide the documents that Turkey is requesting, because it could expose them to sanctions should it be found out later that the oil cargo that they are carrying were sold at prices that went beyond the G7’s $60 price cap.
Turkey has referred to its insurance-checking process as “routine”, arguing that if there were an accident involving a vessel that was found later to be in breach of sanctions, it is possible that the damage wouldn’t be covered by the international oil-spill fund.
“(It) is out of the question for us to take the risk that the insurance company will not meet its indemnification responsibility,” Turkey said.
Much of the crude oil being held up in the Strait is crude oil from Kazakhstan, not Russia. Kazakhstan ships its crude oil from Russian ports on the Black Sea—and it isn’t subject to the G7 oil price cap rules.
By Julianne Geiger
More Top Reads From Oilprice.com:
Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.