British Petroleum avoids sending ships through the Straights of Hormuz

Bloomberg/Fuel Fix:
BP Plc, the British oil giant that had to shelter one of its tankers in the Persian Gulf this month in fear it could be targeted by Iranian forces, is avoiding sending ships to the region after tensions flared between Tehran and London.

BP is “certainly not sending British ships and crews” through the Strait of Hormuz, the only way for tankers to reach the world’s biggest oil-exporting region, Chief Executive Officer Robert Dudley said in a Bloomberg TV interview.

Earlier this month, a BP tanker had to abandon a plan to load Iraqi crude and instead took shelter near Saudi Arabia because the company feared the ship could be targeted in a tit-for-tat response for British Royal Marines seizing a vessel transporting Iranian crude in the Mediterranean, a person familiar with the matter said at the time.

A British warship had to intervene to ensure the BP tanker’s safe exit of the Persian Gulf through Hormuz and the U.K. navy subsequently escorted other British-flagged vessels through the chokepoint responsible for a third of seaborne petroleum exports.
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The British oil giant isn’t the only energy shipper taking precautions amid broader safety concerns in the Strait of Hormuz. Gaslog Ltd., which owns a fleet of liquefied natural gas carries, said Tuesday it won’t allow its ships to transit the key waterway without a naval escort, adhering to the current advice from its flag state Bermuda. The company has 26 LNG carriers on the water, according to its website.

In early July, British Royal Marines stopped the Grace 1 tanker just off Gibraltar and the vessel remains in the British overseas territory’s waters now. The Gibraltarian government said it had reason to believe the vessel was carrying Iranian oil to Syria, which it said would be a breach of sanctions. Iran labeled the act “piracy” and, after the nation’s naval vessels approached the BP ship, another tanker, the Stena Impero, was eventually seized.
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This may lead to more activity for shippers from the US Texas Gulf Coast.  As for LNG, there are also alternative sources from Australia.  The slow down primarily impacts Europe and Asia.

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