Return Begins of Crude Oil US Seized from Iranian Tanker

The nearly four-month battle for control of the crude oil tanker Lana and its cargo appears to be coming to an end. The vessel, which was originally registered in Russia but later switched to the Iranian flag, has been laying in the Piraeus anchorage waiting for the return of the portion of its cargo offloaded onto a second tanker in the United States’ attempt to confiscate the cargo for violations of the sanctions on the Iranian oil industry.

The not-for-profit watchdog organization UANI (United Against Nuclear Iran) is reporting that the return of nearly 60,000 tons of crude oil has begun. The organization says that the ship-to-ship transfer of the oil cargo should be completed by this weekend.

The 70,377 dwt tanker Ice Energy, controlled by Greek interests and registered in Liberia, moved alongside the 115,500 dwt Lana on August 11 in the anchorage outside Piraeus, Greece. The United States chartered the Ice Energy and a second tanker in May and began the ship-to-ship transfer after winning a Greek court order to seize the cargo as a sanctions violation. The Ice Energy completed her portion of the transfer and moved to the anchorage in Piraeus in June but the second portion of the transfer never began as Iran disputed the seizure in the Greek courts.

"Lana is sanctioned by the U.S. for its ties to Russia and its oil is sanctioned for originating by Iran,” Claire Jungman, Chief of Staff for UANI told The Maritime Executive. “Greece, an EU member, had an opportunity to say it will not allow Iran and Russia to engage in this behavior and activity. Instead, this decision by the Greek Courts tells Iran that there are no repercussions for its maritime piracy and hijacking of tankers."

The owner of Ice Energy had sought relief from the Greek courts saying that it was caught between the U.S. and Greek court orders to return the oil. They reported that the U.S. was threatening the tanker operator with a breach of contract and sanctions if they returned the oil not completing the contracted delivery to Texas of the cargo. The Greek appeals court overturned the lower court ruling returning the oil to Iran with unconfirmed reports saying Iran was able to raise doubts on the origins of the cargo. The courts rejected the appeal from the operators of Ice Energy.

It is unclear, however, what will happen next. UANI reported the cargo was first loaded on the vessel a year ago while Iran was seeking a buyer. In April, the vessel at the time named Pegas and registered in Russia sought refuge off the Greek Island of Evia where it was detained. The vessel also failed a port state inspection with multiple safety issues and problems with its propulsion. It was towed to the Piraeus anchorage at the beginning of July.

At the end of July, Reuters reported that the ship-to-ship transfer would not begin until the engine repairs had been completed to Lana. They said that the vessel was going to be fueled and undertake trials to confirm the repairs had been completed to her propulsion.

Iran also continues to hold two laden Greek crude oil tankers that it seized in May in the Persian Gulf in retaliation for the seizure of the oil on Lana. Analysts have indicated that it was likely Iran would release the Greek tankers once the cargo was back aboard Lana.