Update on Red Sea Shipping and Bunkering

January 12, 2024

As the wave of attacks on merchant ships continue in the Red Sea, some 35,000 vessels that sail through the region annually could be affected.

With the disruption of key trade route linking Europe and North America with Asia through the Suez Canal, exporters and shippers are increasingly looking to find alternative ocean transportation routes.

Under an extended threat, ship- and freight forwarders face disruption and freight cost rises. Moving goods around Africa can add as much as 30 days to a voyage.

As a result, we are seeing an increase in bunker demand in East/West Africa and the Arabian Gulf. This is primarily in Durban, Port Louis, Canary Islands, Salalah, and Fujairah.

Effects include longer lead times as barge schedules are booked up and cargo/supplier avails become tighter.

Ultimately, this leads to higher premiums which could disrupt bunker plans.

Our team is actively monitoring arbitrage opportunities and operational schedules for clients.

Contact our traders to maintain smoother shipping operations in the region.