Vincent Clercq, CEO of Danish shipping giant Maersk, told clients he expects Iran-backed Houthi terrorism to disrupt shipping in the Red Sea until the third quarter of 2024 and possibly beyond.
“The longer this goes on, the more ingrained the costs become. We don’t yet know exactly how much of these costs we’ll be able to recover and for how long. The higher rates we’re seeing now are temporary,” Clark said. Quote In a statement released by Marsuk on Monday.
WATCH — U.S. forces strike Houthi targets in Red Sea in a show of defense:
“We remain hopeful that a sustainable solution will be reached in the near future. However, the situation in the region is constantly evolving and remains highly volatile. All available information confirms that security risks remain at a significantly elevated level, which may have an impact on your logistics operations,” the company said in its latest bulletin on the situation in the Red Sea.
Yemen’s Houthi rebels, armed and funded by Iran, began attacking commercial shipping in the Red Sea shortly after the Gaza war began. To pressure Israel to end its military attacks on Hamas in Gaza, the Houthis have said they have attacked U.S., British and Israeli ships and promised safe passage to Iran and its allies Russia and China. But the Houthis often target ships outside of these ranges as well.
President Joe Biden Announced A U.S.-led international effort, Operation Guardian of Prosperity, will be launched in December 2023 to combat Houthi piracy and terrorism. Expressed Confidence in Biden’s efforts low, Houthi attacks continuation There has only been a brief pause in operations. If anything, the Houthis seem to be getting increasingly adept at sinking ships.
In his address to clients, Clark said: Said The company’s pleas to U.S. and European governments to increase security in the Red Sea have been “unsuccessful.”
A Houthi supporter holds up an imitation missile during a Jerusalem Day protest in support of Palestinians in the Gaza Strip, in Yemen’s capital Sanaa, April 5, 2024. (Photo by AP/Osama Abdulrahman)
“In some places, such as Europe, governments need to understand that this could lead to a resurgence of inflation,” he warned.
Clarke said Maersk would only resume sailings in the Red Sea and Gulf of Aden when the safety of ships and crew could be guaranteed. Until then, he promised to do all it could to free up capacity on alternative routes, but warned that costs would increase and cargo space would become even more limited.
“While there is no ‘crystal ball’ to predict how long this situation will last, Maersk is working to mitigate the impact of the disruption, including doing everything we can reasonably do to align supply with business demand,” he said.
“The availability of additional capacity is low to begin with, with carriers across the industry having limited ability to procure additional tonnage. At the same time, demand for container shipping remains solid,” he said.
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Clark explained that the longer alternative route around Africa would essentially require shipping companies to deploy three ships to do the work of one ship following the more efficient Red Sea route.
“Over the next month we will see short positions and ships of very different sizes sailing than normal convoys. This also means we will have a reduced capacity to meet all demand,” he warned.
Clerc I felt sorry for him. Maersk told clients it understood the situation was “difficult for you” and “putting significant pressure on you”.
“No one takes their customers’ supply chains as seriously as Mahrsuk. We can’t protect you from problems, but we can assure you that even though we’re having difficult conversations right now, we’ll make sure they’re handled in the best way possible,” he said.
“We take seriously the amount of trust you have placed in us and will do everything in our power to do our best to help you,” he vowed.
Other shipping companies and industry groups have also stepped up calls for the international community to end Houthi terrorism in the Red Sea after their attacks have begun to damage and even sink ships.
This photo provided by the Indian Navy shows the U.S.-owned ship Genco Picardie, which was attacked by a bomb-laden drone launched by Yemen’s Houthi rebels in the Gulf of Aden, Thursday, Jan. 18, 2024. Attacks on ships in the Red Sea by Yemen’s Houthi rebels have disrupted vital global trade routes, forcing ships to make longer, more costly voyages around Africa. (Indian Navy via The Associated Press)
“It is deplorable that innocent seafarers are attacked while doing their vital work to keep the world warm, fed and clothed,” the coalition of shipping associations said in a statement in mid-June. statement.
“This is an unacceptable situation and these attacks must stop immediately. We call on countries with influence in the region to protect innocent sailors and to quickly de-escalate the situation in the Red Sea. We hear the condemnations and appreciate the words of support, but we urgently call for action to stop the unlawful attacks against these essential workers and this vital industry,” the statement said.
Industry Analyst Said Foreign Policy Iran’s Foreign Ministry said Monday that Western navies had underestimated the Houthi threat and appeared surprised by the intensification of attacks despite joint naval patrols and U.S. and British airstrikes on Houthi-held coastal areas.
“The Houthis have proven to be a very formidable force. This is a non-state actor that is deploying a much larger arsenal and could pose a real headache for the Western coalition,” said Sebastian Bruns, a naval expert at the Center for Maritime Strategy and Security and the Security Policy Institute.
“This is top-of-the-line equipment at this point and it’s really concerning that the Navy is having issues sustaining it at this level,” Brands said.
Chris Rogers, a researcher at S&P Global Market Intelligence, said that even if Houthi attacks stopped tomorrow, the “stick effect” of longer transit times, reduced cargo loads and higher container costs “could take six months to a year to materialize.”
