South Korea said on Tuesday it would be forced to halt imports of Iranian oil from July because of European Union sanctions aimed at pressuring Tehran to abandon its suspected nuclear weapons programme.
Imports would be suspended because the EU would stop offering any type of insurance on such shipments from July 1, the Ministry of Knowledge Economy said in a statement.
A meeting of EU ministers ended Monday with no indication that South Korea would be exempted from the sanctions as it requested, the ministry said.
From the start of next month European firms will be banned from insuring or reinsuring tankers transporting Iranian oil anywhere in the world. South Korea relies entirely on European companies for such insurance.
South Korea bought 9.4 percent, or about 87.2 million barrels, of all its crude needs from Iran last year, but has already reduced purchases in return for a waiver from separate US sanctions.
The ministry said it would work hard to secure alternative sources of crude to minimise the effect on the country’s economy. It said shipments from Iraq and elsewhere had already increased.
The government will also try to ease the impact of sanctions on exports to Iran, the ministry said. Iran is South Korea’s third largest market in the Middle East.
Exports to Iran were up 32 percent from a year earlier to $6.07 billion in 2011. They were worth $2.9 billion in the first five months of this year, a 40 percent rise on the same period last year.