Shipping Costs Surge Amid Red Sea Tensions

Shipping costs in the Red Sea are rising due to increased threats from Iran-aligned Houthis after U.S. airstrikes in Yemen. Industry fears about new attacks are leading to firmer or possibly higher shipping rates, significantly impacting commercial maritime traffic and insurance costs for vessels navigating the area.

Shipping costs through the Red Sea are set to remain high following the U.S. airstrikes on Yemen, fueling concerns of fresh attacks by the Iran-backed Houthis, who have threatened international shipping.

The recent military actions in places like Hodeidah have put maritime traffic at risk, with some insurance rates reaching up to 2% for U.S. and UK-linked ships, industry insiders report. This comes as the Houthis had briefly halted attacks after a ceasefire between Israel and Hamas earlier this year.

Insurance and shipping experts warn of a significant rise in threat levels for vessels, particularly those linked to the U.S. and Israel, amid ongoing regional tensions. The Houthis assert their actions in support of Gaza's Palestinians amidst renewed conflicts.

(With inputs from agencies.)