Red Sea disruption causes Asia-Europe shipping costs to increase by 400%
Shipping disruptions caused by attacks on ships in the Red Sea by Yemen’s Houthi forces have increased the cost of shipping goods on some routes from China to Europe by about 400%.
Disruptions in the Red Sea have also added 10-15 days to delivery times, according to European Economic Commissioner Paolo Gentiloni.
Mr Gentiloni also expressed hope that the crisis on one of the world's most important trade routes would not lead to a significant increase in inflation in the EU, but warned that if it continued, supply would be disrupted, pushing up prices.
Since the Israel-Hamas conflict erupted in October 2023, Yemen’s Houthi forces have carried out dozens of drone and missile attacks on commercial vessels passing through the Red Sea. As a result, many major shipping companies have stopped shipping through the Suez Canal and instead rerouted their ships around the Cape of Good Hope in southern Africa.
The attacks have also caused average container rates to double globally over the past month, pushing fuel tanker rates to some destinations to multi-year highs.
Last month, EU foreign ministers reached an agreement to deploy a naval mission in the Red Sea to protect cargo ships. Germany, France and Italy proposed the move in response to a request from the Netherlands, whose shipping industry has been particularly hard hit by attacks.
The mission to protect cargo ships is expected to be deployed on February 19, said EU High Representative for Foreign Affairs and Security Policy Josep Borrell.
The plan would see the EU deploy warships and an airborne early warning system to protect cargo ships in case of a threat. Borrell said no country had objected to the proposal, although some may decide not to participate.
AFP news agency reported that the Aspides mission will consist of at least four warships. The overall command of the mission will be Greece, while the control operations on the ground will be carried out by Italy. According to the European Union, the mission will have an initial term of operation of one year. Its mission will be limited to protecting civilian ships in the Red Sea and will not carry out attacks on Yemeni territory.
Source: cafef.vn
