Japan Tries to Break Iranian Oil Embargo
The Japanese government is preparing to get approval from parliament to allow Japanese companies to insure 16 Iranian oil tankers carrying Iranian oil to Asia. Under the current embargo, Western insurance companies are refusing to insure the tankers.
Japan is not the only county seeking loopholes in the Iranian sanctions as the world strives for access to cheap Iranian oil. Indian and Turkey have already expanded their oil imports with Iran in light of poor international consensus on the strength of the sanctions, no effective means to enforce the embargo, and no recourse or punishment for violators.
This is not to say that the embargo is a complete failure. It is clearly having a devastating affect on the local economy, which is now seeing the early stages of hyperinflation as prices – especially for imported items – starts rising at an uncontrollable pace. The embargo also makes exporting Iranian oil more expensive, so this will have a great impact on the price of crude oil, especially Iranian oil prices.
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