Insurers warn risk of Iranian Gulf ship seizures remains high

Insurers warn risk of Iranian Gulf ship seizures remains high
The event took place at the top of London's 'Gherkin' building

Insurance company representatives have warned that, although a few weeks have passed since a ship was last seized by Iran, the risk of further escalation and seizure remains high.

Speaking at London International Shipping Week, Beazley insurance company’s head of hull and war Richard Young warned that risks remain high so rates are unlikely to come down soon.

Although the crisis is out of the news, “the pathways to potential escalation are manifold,” he warned.

These concerns were echoed by fellow speaker Nick Busvine, a partner in strategic intelligence firm Herminus. 

Speaking the day after the anti-Iran hardline US National Security adviser John Bolton lost his position, Busvine said that US Secretary of State Mike Pompeo was not much softer than Bolton on Iran.

“The stand off absolutely continues,” he said. “Despite Bolton’s departure, we are in a ramp-up situation.”

In July 2019, British forces seized an Iranian tanker near Gibraltar. Britain claimed it was delivering oil to Iranian-allied Syrian dictator Bashar Al-Assad in contravention of EU economic sanctions.

Later in July, Iranian forces detained a Panama-flagged ship, the  British-flagged Stena Impero and, on August 4, an Iraqi-flagged tanker.

Busvine said that sanctions are only effective if everyone believes they will be backed up with military force. 

He added that the Iranians, and the Iranian Revolutionary Guard, are confident thanks to several military successes in the last decade – in Syria, Iraq and Yemen.

While nobody wants a war, he said, there is a chance one could happen by accident. If this happened, trade and commerce would suffer greatly, he added.