0 $
2,500 $
5,000 $
600 $
OCTOBER 2024

Global Economy Threatened As Israeli War On Gaza Impacts Shipping In Red Sea

Support SouthFront

Global Economy Threatened As Israeli War On Gaza Impacts Shipping In Red Sea

Illustrative image.

Shipping and logistics majors A.P. Moller-Maersk, Hapag-Lloyd and MSC have stopped their ships from entering the southern entrance of the Red Sea after their vessels were attacked by the Yemeni Houthis (Ansar Allah) in response to the Israeli war and blockade on the Palestinian Gaza Strip.

Maersk and Hapag-Lloyd both announced their decision to halt shipping operations in the southern Red Sea on December 15.

In a statement, Maersk said its decision comes after a near-miss incident involving its Maersk Gibraltar ship on December 14 and another attack on a container vessel on the next day. The company instructed all Maersk vessels in the area bound to pass through the Bab el-Mandeb Strait to pause their journey until further notice.

“We are deeply concerned about the highly escalated security situation in the southern Red Sea and Gulf of Aden,” Maersk said in a statement. “The recent attacks on commercial vessels in the area are alarming and pose a significant threat to the safety and security of seafarers.”

Meanwhile, Hapag-Lloyd spokesman Nils Haupt said on December 15 that some of the company’s ships were asked to pause and drift outside the strait, a narrow stretch of water that links the Indian Ocean to the Red Sea. It’s also a key passage that enables ships to travel to Egypt’s Suez Canal.

Hapag’s Al Jasrah vessel was hit by an unknown object earlier in the day while traveling through the strait, according to Haupt.

“It’s very worrisome because ships heading to the Suez have to pass through the strait,” Haupt said. “We are stopping some ships, but there is no general rule yet, though this could change.”

MSC, the world’s largest shipping carrier, joined the two on December 16, announcing that its vessels will no longer be traveling through the Suez Canal after its container ship, the MSC PALATIUM III, was attacked a day earlier while transiting the Red Sea under a subcharter to Messina Line.

“Due to this incident and to protect the lives and safety of our seafarers, until the Red Sea passage is safe, MSC ships will not transit the Suez Canal Eastbound and Westbound. Already now, some services will be rerouted to go via the Cape of Good Hope instead,” MSC said in an advisory.

The company explained the new routing will impact the sailing schedules by several days for vessels booked for Suez transit.

“We ask for your understanding under these serious circumstances,” the advisory continued.

The Houthis, who control much of Yemen’s Red Sea coast, are a part of the so-called Axis of Resistance that is backed by Iran and opposes Israel. The group has fired several missiles and drones at the southernmost Israeli city of Eilat since the war broke out in Gaza. It has also assaulted a number of Israeli-owned ships.

Earlier this month, the Houthis announced that they will start targeting any ship passing through the Red Sea en route to Israel, regardless of whether the ship’s ownership is linked to the country, in response to the Israeli blockade on Gaza. Several vessels were later targeted near the Bab el-Mandeb Strait by the group.

The Bab el-Mandeb Strait is located between the Horn of Africa and the Middle East. It connects the Red Sea to the Gulf of Aden and the Arabian Sea, which feed into the Indian Ocean. The strategic waterway is used by container ships and exports of petroleum and natural gas from the Persian Gulf.

Approximately 12% of the world’s trade, which includes 30% of all global containers, move through the Suez Canal. That then feeds through the Red Sea and Bab el-Mandeb.

The Houthis recent attacks forced ships heading to Israel from Asia to take a route that circles Africa, making the journey three weeks longer and more expensive.In addition, the arrival of commercial ships to the port of Eilat has almost completely stopped.

The decision of Maersk, Hapag Lloyd, and MSC to halt shipping through the Bab el-Mandeb Strait will only magnify the impact of the blockade. The collective vessel market share of the three giant companies is approximately 40% of global trade.

Tensions in the strategic strait came after the Panama Canal drastically reduced its throughput capacity due to a severe drought this year.

Bulk grain shippers hauling crops from the United States Gulf Coast export hub to Asia are sailing longer routes and paying higher freight costs to avoid vessel congestion and record-high transit fees in the drought-hit canal, according to reports from last week

Prices for guiding ships through the Panama Canal are already rising, while the prices for shipping through Suez will officially rise with the beginning of next year.

If the Houthis keep their blockade on the Bab el-Mandeb for a long time; and if the drought affecting the Panama Canal is strong and remains in force until April or even June; then the global supply chain will face major problems which will reflect on the global economy.

The U.S. and European countries, not just Israel, will suffer from this shipping crisis. With the current spending on the war in Ukraine, large-scale sanctions and involvement in many other conflicts, the economy of the West may not survive.

MORE ON THIS TOPIC:

 

Support SouthFront

SouthFront

Subscribe
Notify of
guest
19 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
The Crunge

shippety doo da shippy day, hire prices are coming our way.

hash
hashed
The Crunge

oops, higher prices are coming our way.

Dstroj

correct 2x. hire someone to artificially create higher prices.

Daniel Weatherman

no way it will double prices. shipping costs are a tiny fraction of what things cost in the shops. 8% price rise if they managed to get every ship to avoid the straits…….thats only for europe on the rotterdam/piraeus to china routes. maybe some more more for commodities and a price gouge for oil. minor nuisance.

Boycott usa the world's bully

refined fuel, diesel and petrol, costs to europe can go up a lot, as now coming from india because of europe suicide sanctions on stuff from russia. transport costs a higher portion of the cost of refined oil products. also risk of accidents in the cape of good hope stormy waters. same for gas from qatar, etc. really bad for europe getting shafted for its aggressive policies to russia and middle east.

Beťar

blbosť. tá je ohrozená niečím iným.

hash
hashed
Name

time for russias arctic silk road.

hash
failed
Vitex

war in middle east, blockrack happy.

hash
hashed
Abraham Licoln

global economy threatened as israeli war on gaza impacts shipping in red sea wow is south front a propaganda piece for the mossad now? only israeli ships or ships bound for israel are targeted, how is this a threat to global trade?

hash
hashed
Boycott usa the world's bully

israel allies ships, e.g. from uk and france also targets. all major europe shipping companies are diverting ships away from red sea and around africa instead.

tomsawyer

in my hillbilly homosexual economy burger more intelligent than amerikan

hash
hashed
Dstroj

how dun i right git r dun yur newsletter?

Mac.

just givvem ship sinkin missile mr putin as we in the real world love that davey jones locker, just sink those bastard…

hash
hashed
zman

“no general rule”…sure there is. if you’re headed to israel, turn around or go down. if you’re owned by israeli’s, the same. if you have israeli products, the same. if none of these apply, go ahead, no problem. seems pretty simple. but they don’t like simple, do they? they prefer to obfuscate and lie.

hash
hashed
Boycott usa the world's bully

yes. also add “israel allies” to israel.

Boycott usa the world's bully

what is the position of egypt now losing suez canal transit fees?

hash
hashed
Boycott usa the world's bully

everyone thought israel’s genocide on gaza would escalate to war in lebanon or syria. but first it escalates to a red sea shipping blockade. violence has unpredictable outcomes.

M.Paraplu

i thought the war would escalate to israel and i still think it will.

Shaman

dumb amerikunty hillbilly pay billions$ as houthis target all vessels from satanic nations russian vessels excepted….port calls elias down 85%

hash
hashed
19
0
Would love your thoughts, please comment.x
()
x