Gulf oil drought feared

Press, 19 May 1984, Page 9

Gulf oil drought feared

NZPA-Reuter Bahrain Intensifed missile attacks on ships in the Persian Gulf this week have sent oil prices on the Rotterdam spot market sharply higher and led to a slide in the value of the yen, reflecting the heavy dependence of the Japanese economy on Middle East oil. A sixth of the non-com-munist world's oil passes through the waterway, and fears that this might be choked off have heightened after an attack on a Saudi supertanker close to the

Saudi coast that marked an escalation of the Iran-Iraq war. Tanker charters for the Gulf have all but dried up after the attack, one of five this week. London shipbrokers said yesterday that most owners were unwilling to risk their vessels and crews. The London insurance market has reacted to the attacks by trebling the war risk premium for vessels calling at the ports of Kharg or nearby Bandar Bushire. This could mean an insur-

ance bill of SUS3OO,OOO for seven days cover, on top of insurance for the cargo, extra bonuses for the crews and a charter cost of about $2 million for a return trip to northern Europe. But brokers doubted that all shipowners would stop lifting oil. According to Lloyd’s, there were about 400 oil tankers laid up at the end of April because of an over-supply of vessels and they predicted that many owners would be glad to get these working for a high enough price.