Maersk announced the suspension of all vessel crossings in the Strait of Hormuz until further notice. ‘As a result, services that call at ports in the Persian Gulf may experience delays, diversions, or schedule adjustments,’ stated the company to Argus. Maersk also announced that it will temporarily suspend future transits through the Suez Canal via the Bab el Mandeb Strait. Until further notice, all transit of ME11 services (Middle East-India to the Mediterranean) and MECL (Middle East-India to the East Coast of the U.S.) will be rerouted around the Cape of Good Hope. The container shipping company Hapag Lloyd said it is suspending all vessel transits through the Strait of Hormuz due to the conflict until further notice.
Shipping Rates: The rates for VLCC TD3C from the Baltic increased by 47% in the last session according to AFP, reaching $82,500/day. Container rates on the SCFI Asia-Europe route reached $9,200/TEU following the incidents involving tankers in the Strait of Hormuz. Real-time AIS data from Bloomberg shows that 38% of scheduled transits from the Gulf are being diverted around the Cape of Good Hope.
The Lloyd’s Joint War Committee added commercial traffic in the Strait of Hormuz to the exclusion list; for AFP the additional premiums quoted for VLCCs currently range between 2.1% and 2.8% of the hull value per trip (between $4.2 million and $5.6 million). Several P&I insurance companies, according to Reuters, issued cancellation notices with 24 hours’ notice for any vessel within 200 nautical miles of Iranian waters.
Insurance: Reinsurance markets have effectively withdrawn 40% of capacity for any exposure in the Gulf; global hull rates are now factoring in a permanent risk premium of 400 basis points.
Prior to the latest round of fighting, the company had planned to resume transits through the Red Sea. However, due to the worsening security situation, it decided to maintain the routes around the Cape of Good Hope for its services between Asia and Europe and to divert some vessels. The cancellation of the routes for MSC Euribia and Celestyal ships in the Persian Gulf is forcing shipping companies to rethink their spring itineraries. Port sources in Tenerife and Las Palmas indicated to Canarymaritime that there is capacity for bunkering supply as an alternative home port for cruises that were originally expected to operate in Dubai or Abu Dhabi.
MSC stated that it is halting all global cargo bookings to the Middle East region until further notice and ‘has instructed all vessels currently operating in the Middle Eastern Gulf region, as well as those en route to the area, to proceed to designated safe havens until further notice‘.
