Some oil firms to avoid ships on Iran blacklist

Four sources familiar with the matter reveal that at least three Indian oil refiners and a global energy major intend to steer clear of ships on Iran's newly introduced blacklist, citing security concerns. Tehran's blacklist, unveiled on Sunday, comprises 45 vessels that allegedly violated its regulations for crossing the Strait of Hormuz.

The move escalates Iran's threats against the crucial waterway, which is vital for global energy supplies six months into the conflict between the US-Zionist entity and Iran. The Iranian announcement aims to disrupt the Gulf oil producers' shuttle runs, which involve dedicated tankers transferring oil from the Gulf to the Strait of Hormuz for loading onto other vessels for delivery to end-users.

The stricken vessels may face fines, detention, and confiscated cargoes, according to a post on the social media platform X from the Persian Gulf Strait Authority, a newly established body tasked with overseeing the strait. One of the sources, employed at an Indian refinery, stated that these companies will avoid using chartered or non-compliant ships for Middle Eastern cargoes.

While some shipping data indicates that some of the listed tankers belong to or are chartered by Saudi Aramco and Abu Dhabi National Oil Co (ADNOC), both companies declined to comment. Trade risk analyst Ana Subasic from Kpler predicts that the most compliance-conscious buyers will shun these vessels moving forward, but the trade is more likely to redirect through alternative tonnage, counterparties, or transfer locations rather than cease entirely.

Shipping firms are deliberating whether to continue their Ship-to-Ship (STS) operations and assess Iran's warning, with one Gulf crude buyer stating that it would be safer to purchase oil delivered directly to the final destination instead of using STS locations in the Gulf of Oman. The remaining 10 of the 12 Very Large Crude Carriers (VLCCs) on Iran's blacklist stopped transmitting their location via Automatic Identification System (AIS) after the blacklist was released, while the rest had their AIS transponders disabled for weeks.

Kpler's Subasic emphasizes that the primary concern is the "contagion" effect, as Iran's implementation of penalties for STS transfers with blacklisted tankers could reduce the pool of willing shipowners, charterers, and buyers, particularly those with significant Gulf exposure, while potentially raising due diligence requirements and freight, insurance, and risk premia.