>>132639 pb
Seizure in the Straits of Hormuz - implications for insurers
09/10/2023

Geopolitical conflicts between the US and Iran remain a major concern for marine (re)insurers as tensions in the Strait of Hormuz continue to make headlines. The ongoing situation continues to affect whether vessels and cargo such as crude oil can go into or out of Iran, and the cover marine insurers can provide.

Background
On 14 July 2015 the UN Security Council’s five permanent members: China; France; Russia; the UK; and the US; plus Germany, the European Union, and Iran reached an agreement to limit and ensure that Iran’s nuclear program of uranium enrichment was exclusively peaceful, and provided Iran with phased sanctions relief upon verification that it had implemented key nuclear commitments.
In May 2018 then-US President Trump abandoned the JCPOA and reinstalled all US sanctions on Iran, including placing the Iranian Revolutionary Guard Corps-Qods Force (IRGC-QF) on the Office of Foreign Assets Control (OFAC) Specially Designated Nationals and Blocked Persons List.
In 2021 we commented that the inauguration of Joe Biden as the 46th US President may bring a different approach to foreign policy, including the challenging topic around Iranian sanctions. President Biden made it clear that he wanted the JCPOA deal brought back to life, but expected Iran to comply with its commitments in respect of reversing its breaches in respect of excess production of enriched uranium first; Iran wanted the US sanctions - which caused its economy to fall into a recession and inflation to soar - lifted before it would start complying with its commitments again.

Impact on shipping
The impact on global commerce has been significant, particularly in the Strait of Hormuz, a key shipping lane through which 20% of global crude oil supply passes. Since 2021 it has been reported that nearly twenty internationally flagged merchant vessels have been harassed, attacked, or seized by Iran whilst transiting the narrow waterway linking the Persian Gulf with the Gulf of Oman.
cont...
https://kennedyslaw.com/en/thought-leadership/article/2023/seizure-in-the-straits-of-hormuz-implications-for-insurers/