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Major shipping companies, including Hapag-Lloyd, Evergreen Line, and MSC, continue to avoid the Red Sea despite a new US-led security operation. The operation, named Prosperity Guardian, aims to safeguard one of the world’s crucial trade arteries.
Hapag-Lloyd and Evergreen Line informed CNN that they would reroute vessels via the Cape of Good Hope at Africa’s southern tip due to the perceived danger in the Red Sea. MSC echoed the sentiment, emphasizing a continuous assessment of the situation with plans for a review.
In contrast, Maersk, following the establishment of Operation Prosperity Guardian, announced the resumption of transit through the Red Sea and the Gulf of Aden. CMA CGM also reported recent transits, emphasizing a careful evaluation of the security landscape.
However, the area’s persistent insecurity was evident when an MSC vessel was attacked en route from Saudi Arabia to Pakistan, prompting the company to prioritize the safety of seafarers by rerouting vessels via the Cape of Good Hope.
Regardless of the chosen route, shipping costs are expected to rise. Maersk, CMA CGM, and Hapag-Lloyd have introduced new charges, citing the dynamic situation in the Red Sea and necessary operational adjustments. Hapag-Lloyd’s “Emergency Revenue Charge” for Red Sea cargo will add $1,000 to eastbound and $1,500 to westbound 20-foot containers.
The shipping disruption’s potential spillover into consumer goods prices raises concerns, especially with charges taking effect in January. The impact on global trade schedules and equipment supply is further exacerbated by the companies’ necessary operational adjustments.
Moreover, Israel’s conflict in Gaza is influencing natural gas prices, with concerns that the regional conflict could escalate. Despite record levels of stored gas in Europe and mild temperatures, geopolitical tensions, including the Red Sea transit risk, contribute to a cautious outlook as we approach 2024.
Souser:CNN
