South Korea shipping companies suspend Iran oil imports

(SEOUL) - Two South Korean shipping companies said Friday they had this month suspended importing crude from Iran due to a looming EU oil embargo that could effectively halt shipments of Iranian oil from July.

SK Shipping, which handles refiner SK Energy's crude shipments, said it shipped its last cargo from Iran early this month and it will arrive by the end of the month.

Hyundai Merchant Marine said it had not carried any Iranian crude for Hyundai Oilbank in June.

SK Energy and Hyundai Oilbank, the only refiners that were still importing Iranian oil, said the suspension was temporary as Seoul seeks an exemption from the EU embargo, being imposed over Iran's disputed nuclear programme.

Under the sanctions which come into effect on July 1, the EU will ban European firms from insuring or reinsuring tankers transporting Iranian oil anywhere in the world.

This could mean Korean refiners, who rely on European companies for insurance, are unable to import supplies.

"Should things go well, (Hyundai) will likely import Iran's crude again," a Hyundai Oilbank official said.

South Korea, which has no domestic oil resources, wants to cut shipments from Iran rather than completely halt them since they make up about 10 percent of its total crude imports.

The United States has exempted South Korea and six other emerging economies from tough new sanctions after they cut back on oil purchases from Iran.

The government plans to make a statement about EU sanctions on June 26, after a meeting of EU ministers.

-- Dow Jones Newswires contributed to this report --