Commercial vessels transiting the region remain under threat

Disruptions in one of the world’s most critical shipping lanes continued this week as Houthi rebels defiantly continued their attacks against commercial vessels in the Red Sea despite strikes by US-led forces against targets in Houthi-controlled parts of Yemen.

The latest alert issued by the U.S. Department of Transportation Maritime Administration states: “There continues to be a high degree of risk to commercial vessels transiting the Southern Red Sea between 12N and 16N. While the decision to transit remains at the discretion of individual vessels and companies, it is recommended that U.S. flag and U.S. owned commercial vessels remain North of 18N in the Red Sea or East of 46E in the Gulf of Aden until further notice.”

A growing number of shipping companies have stopped using the Red Sea passage amid the escalating situation. As of January 17, the logistics company Kuehne+Nagel had identified 334 vessels impacted by the Red Sea situation, representing an estimated total capacity of 4.42 million TEU. The global shipping news service TradeWinds reported that Red Sea war risk insurance rates could soon exceed 1% of hull value, up from about 0.5% prior to this week’s Houthi attacks.

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