The Red Sea, a vital corridor for about 10% of global seaborne oil flows, is facing heightened maritime security risks, pushing insurance costs higher for commercial ships navigating the region. Recent attacks on various types of vessels, from car carriers to tankers and dry bulkers, have intensified concerns, prompting warnings from navies and coast guards.
The escalation in security threats traces back to the Israel-Hamas war, Houthis have targeted commercial ships, leading to increased advisories from maritime authorities. Maritime Trade Operations regularly issues alerts, emphasizing caution in the region, particularly when uncrewed aerial systems or drones are detected. The risk of attacks has prompted discussions on potential rises in insurance premiums for ships navigating the region.
Maritime insurance executives suggest that if the attacks persist or the conflict widens, premiums may increase, Even before the recent conflict in Gaza, a shipping transit system was in place due to the war in Yemen, emphasizing the strategic importance of secure passage through the narrow Bab el-Mandeb Strait.
Shippers are now meticulous during vetting, avoiding any Israeli links due to increased risks. Regardless of their flag or management, face challenges in securing lower freight rates, with some experiencing sporadic charter discounts. While the attacks on these vessels are form a small part of overall traffic, concerns are growing.
The escalation in insurance premiums and perceived risks might redirect vessels to longer routes, such as circumnavigating the Horn of Africa, contributing to increased transportation costs. The industry awaits coordinated responses from international allies and partners to address the evolving challenges in this critical maritime corridor.The maritime community remains on high alert.
Source:Reuters
