Shippers Brace for Operations Without Suez

The shipping industry is preparing for the prospect of operating without its most import trading route for weeks, according to Bloomberg.

• The US has put together a new naval task force to patrol the troubled area and protect commercial vessels, but shippers are waiting for details.
• Moreover, the Houthis warned member of the task force that they will be legitimate targets if they interfere in its ongoing operations against Israel-linked vessels.
• Shippers are now sending vessels via the Cape of Good Hope, adding 7-10 days to voyages, adding a further $1m to costs.
• The proposed naval convoy may also create delays. “It will slow down the trade because we will have to wait for a convoy to pass through” the region, Euronav CEO Alexander Saverys told Bloomberg.
• It is likely that shipping companies will only return to the area once the effectiveness of any security provisions are demonstrated, Bloomberg said.