By Jonathan Saul

LONDON, Jan 20 (Reuters) – United Arab Shipping Company is resuming enterprise with Iran following the lifting of Western sanctions, regardless of the deep-seated political rivalry between the Islamic Republic and Saudi Arabia, one of many delivery line’s essential shareholders.

A nuclear deal between world powers and Iran led to the removing on Saturday of worldwide oil export prohibitions in addition to restrictions on banking, insurance coverage and delivery.

Sunni Muslim Saudi Arabia has grave reservations in regards to the lifting of sanctions on its essential regional rival, with which it minimize ties earlier this month after its Tehran embassy was attacked following Riyadh’s execution of a Shi’ite cleric.

Other Gulf nations which maintain stakes in UASC even have troublesome relations with Iran.

But a supply near the delivery line made clear that for UASC, business issues had been extra essential than political difficulties.

Kuwait-headquartered UASC advised Reuters on Wednesday it had “started accepting shipments to and from Iran”.

“It is important to note that a number of sanctions are still in place, therefore, the ability to accept cargo volumes to/from Iran will continue to be based on UASC’s strict internal compliance check, which is in line with the international laws and applicable sanctions,” it stated in a press release.

With U.S. sanctions nonetheless in place, which exclude U.S. people, banks and insurers from buying and selling with Iran together with enterprise denominated in {dollars}, delivery and marine insurance coverage sources say many international corporations are prone to tread fastidiously.

UASC, based in 1976 and with company workplaces in Dubai, is owned by the governments of the United Arab Emirates, Bahrain, Saudi Arabia, Kuwait, Qatar and Iraq.

Qatar holds a 51 p.c stake within the group, Saudi Arabia has 35 p.c and the remaining nations have smaller holdings.

Sunni Muslim energy Saudi Arabia minimize relations with Shi’ite Iran earlier this month.

The disaster erupted when Saudi Arabia executed a Shi’ite cleric on Jan. 2 and Iranian protesters retaliated by storming and setting fireplace to the Saudi embassy in Tehran.

In solidarity with Riyadh, Kuwait and Qatar subsequently pulled out their ambassadors from Tehran, and the United Arab Emirates downgraded its ties. Bahrain and two non-Gulf states, Djibouti and Sudan, severed relations fully.

The supply near UASC advised Reuters it was enterprise as standard regardless of the tensions.

“Whatever makes sense commercially and whatever benefits customers are a priority. That is how UASC looks at this matter,” the supply stated. “Qatar and Saudi being the largest shareholders in UASC clearly do not impact its commercial activities.”

“Historically, since the company’s foundation, politics normally stayed away from the board room,” the supply stated. “UASC is commercially managed.”

The supply stated UASC weathered Iraq’s invasion of Kuwait in 1990, even with employees relocating for some time.

“If you look at the shareholding nations’ relationships … they were not always at the best levels,” the supply stated. “Meetings continued and services were normal,” the supply stated, referring to the 1991 Gulf War during which a U.S -led coalition pressured Iraq out of Kuwait.

UASC stated previous to slicing ties, the Iranian market represented round 2 to three p.c of the group’s general enterprise.

The container market has been hit by a slowdown in demand from Asia, particularly China. The sector can also be struggling one among its worst recessions attributable to worries over the world financial system and a surplus of vessels out there for rent, main delivery traces to hunt what alternatives they will.

NEW OPPORTUNITIES

UASC, which suspended all Iran enterprise in April 2013, stated it could initially service the Islamic Republic utilizing smaller feeder ships by way of third events that shipped containers to Iran from the United Arab Emirates. It aimed to renew direct calls as quickly as potential.

“For the shipping industry, the relaxation of sanctions is likely to create opportunities resulting in additional volumes due to the expected increase in infrastructure projects as well as the ability of Iranian consumers to access a wider range of foreign goods,” the UASC assertion stated.

Iran had relied on international ships for a lot of its imports, however has relied extra on land routes and its personal business fleet, notably since 2012, as layers of sanctions led to an exodus of Western delivery corporations, inflicting provide disruptions.

In August final yr the world’s quantity three line, France’s CMA CGM, and quantity 4, Evergreen of Taiwan, had been the primary to renew direct companies to Iran. In late December MSC of Switzerland, the world’s second greatest container delivery line, resumed direct calls.

The world’s greatest line Maersk stated this week it was “looking into how and when we can resume container transportation services to/from Iran”, with out offering additional particulars.

German container line Hapag Lloyd stated this week it could proceed to supply solely feeder companies, which began in November, including it could deal with “all Iran cargo with utmost care in terms of compliance”.

According to consultancy Alphaliner, UASC’s market share, primarily based on fleet capability, is estimated at 2.6 p.c versus practically 15 p.c for Maersk.

(Editing by David Evans and Giles Elgood)

(c) Copyright Thomson Reuters 2016.