Shipping and Transport: The Case of KRG

Oftentimes shipping is viewed as a stand-alone industry operating in a vacuum or at least two-dimensionally on the surface of the water. Truth be told, shipping is a multi-directional industry at the interface of many human activities from culture and finance to trade and geo-politics.

There has been a lot of reporting on the case of the Kurdish Regional Government (KRG) attempting to sell oil originating from Iraq. There has been a dispute of the ownership title of the commodity emanating from the political developments presently in Iraq. As a result, the tanker vessels and their shipowners engaged to transport such oil ended up with situations of vessels disappearing from radar screens and databases and repairing with different drafts (read cargo onboard), anchored in international waters to avoid arrest, and being the subject matters for many courts and court orders. We thought that this may make an interesting case of further illuminating certain aspects of the shipping industry, and thus we place here three articles on the topic; we have been pleased that Basil Karatzas has been quoted in two of these articles (Bloomberg BusinessWeek and Rudow English):

An opinion article in The New York Times on November 9th, 2014 by Luay Al Khatteeb and Ahmed Mehdi titled ‘The Kurds cannot Afford to Leave Iraq’ provides a brief overview of the recent developments in Iraq and Kurdistan which acts as a name frame for understanding the actual events from the trade of ‘Kurdish’ oil.

In an extensive article, Bloomberg BusinessWeek has reported on the logistics and operational issues involving the shipping and transport of the oil (‘A Mysterious Oil Tanker Might Hold the Key to Kurdish Independence‘, on October 23rd, 2014), primarily with the tanker vessel MT ‘United Kalavryta’ anchored in international waters of the Texas Coast for several months while the matter of ownership of the cargo plays out ashore in the Courts of the State of Texas.

And in an article by Rudow English, there has been reporting on the actual agreement to find buyer for the cargo at terms that likely will never been known in detail. The article is titled: ‘Hungary deal boosts outlook for direct Kurdish oil sales’ by Sharmila Devi.

As they say, never a boring day in shipping!

Managing risk is always crucial!

Managing risk is always crucial in shipping.

© 2013 – 2014 Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

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