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HomeLife InsuranceThree Insurers Reject Chevron’s $57 Million Claim for Iran Oil Seizure

Three Insurers Reject Chevron’s $57 Million Claim for Iran Oil Seizure

Three insurance companies have rejected Chevron’s claim over the seizure last year of an oil cargo by Iran, according to a complaint filed on Tuesday in a U.S. court in California.

The Chevron-chartered tanker Advantage Sweet was boarded by Iranian military in the Gulf of Oman in April 2023 and its crude oil cargo confiscated and later transferred to an Iranian vessel.

Zurich American Insurance, Liberty Mutual Insurance and Great American Insurance asked a U.S. District Court in San Francisco to uphold their rejection of Chevron’s $57 million claim under both marine cargo and war risks policies the company held.

“The seizure of the crude oil and its later expropriation by Iran do not constitute ‘warlike operations,’” the companies said of their denial of war risks coverage. Chevron’s marine cargo policy also did not cover a seizure or confiscation, they told the court.

A Chevron spokesperson said the company contests the denial of insurance coverage.

“The military seizure by the Islamic Republic of Iran of the Advantage Sweet in international waters with Chevron’s cargo aboard was a hostile act plainly covered by our insurance policies. We look forward to proving this in court,” said Chevron spokesperson Christine Dobbyn.

Chevron chartered the Advantage Sweet to transport crude oil to Houston from the Neutral Zone area shared by Saudi Arabia and Kuwait, the complaint said. Chevron has oil production operations in the zone.

“Iranian Navy commandos boarded the Advantage Sweet while the vessel was in international waters in the Gulf of Oman on or about April 27, 2023 and seized control of the vessel and its cargo of crude oil,” according to the complaint.

(Reporting by Gary McWilliams; editing by Chizu Nomiyama and Diane Craft)

Topics Carriers Energy Oil Gas Numbers

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