Iran has allocated billions of dollars to insure its oil tankers itself, the Fars news agency reported on Friday, its latest effort get oil to the buyers through the financing obstacles set by Western sanctions.

The European Union imposed a ban on July 1 on insurance for tankers carrying Iranian oil, preventing EU insurers and reinsurers from covering tankers carrying Iran’s crude anywhere in the world.

'After the European Union imposed insurance sanctions on Iranian tankers… the government has allocated billions of dollars for insuring Iranian tankers that export Iranian oil,'an unnamed official told Fars.

A senior official from Iran's major tanker operator NITC told Reuters in June that it had secured insurance cover from privately owned Iranian provider Kish P&I, with $ 1 billion in insurance in the event of a collision or oil spill.

European insurers dominate the marine insurance sector, and Iran's Asian crude buyers have struggled to find a way to replace them. As a result, Iran has seen its oil exports plummet from regular levels seen last year.

Earlier this month, Iran said it would insure any foreign ships that enter its waters but no further detail was provided on how the scheme would work for foreign companies and how insurance would be paid in the event of an accident at sea.

Earlier this month industry sources said Japanese insurers were expanding their maritime coverage to allow more domestic tankers to transport Iranian crude.

Last month India said it would allow state refiners to import Iranian oil, with Tehran arranging shipping and insurance. In May, Indian refiner MRPL secured coverage from an Iranian insurer, becoming the first Indian firm known to do so.