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Biggest cargo shipping companies have suspended vessel transits to and from the Middle East
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Iran, in response to the United States and Israel attack, has launched counter-attacks across the region and closed the Strait of Hormuz
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The top five container lines – MCS, A.P. Moller-Maersk, CMA CGM, COSCO, and Hapag-Lloyd – issued their respective advisories on March 1 relating to the security situation, with all of them noting the prioritization of crew and vessel safety
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Re-routing and other adjustments being undertaken as companies monitor developments in the Arabian Peninsula
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CMA CGM announced an emergency conflict surcharge ranging from US$2,000-$4,000 effective March 2 for all cargo in the following lanes: From or to Iraq, Bahrain, Kuwait, Yemen, Qatar, Oman, United Arab Emirates, Kingdom of Saudi Arabia, Jordan, Egypt / Port of Ain Sokhna, Djibouti, Sudan, Eritrea
The world’s biggest cargo shipping companies have suspended vessel transits to and from the Middle East after the United States and Israel attacked Iran, and the government in Tehran has launched counter-attacks across the region and closed the Strait of Hormuz.
The top five carriers issued their respective advisories on March 1 relating to the security situation, with all of them noting the prioritization of crew and vessel safety as well as adjustments being undertaken as they monitor developments in the Arabian Peninsula.
Reuters earlier reported that multiple vessels in the area have received VHF transmission from Iran’s Revolutionary Guards that “no ship is allowed to pass the Strait of Hormuz,” according to an official with the European Union’s naval mission Aspides. The British Navy said Iran’s orders were not legally binding and advised vessels to transit with caution.
The US Navy had also warned against navigation in the whole of the Gulf, Gulf of Oman, North Arabian Sea, and the Strait of Hormuz, saying it could not guarantee the safety of shipping, Reuters said, citing tanker association INTERTANKO.
About 20% global oil – including those from Saudi Arabia, the United Arab Emirates, Iraq, Kuwait and Iran – passes through Hormuz along with large volumes of LNG from Qatar.
Swiss firm MSC, the world’s largest container line with about 20% market share, has temporarily stopped all bookings for worldwide cargo to the Middle East region.
“In response to the evolving security situation in the Middle East, MSC Mediterranean Shipping Company confirms that the safety of its crew remains its highest priority,” MSC said.
“The Company continues to closely monitor developments and is working with relevant authorities to ensure the safety of its operations. Middle East bookings will resume as soon as the security situation improves,” it added.
A.P. Moller-Maersk, on the other hand, is still accepting cargo bound for the Middle East, but warned of delays.
“Until further, all sailings on the ME11 (Middle East-India to Mediterranean) and MECL (Middle East-India to East Coast US) services will be rerouted around the Cape of Good Hope. The safety of our crews, vessels and customers’ cargo remains our key priority and we will continue to monitor the situation closely and take all needed actions,” the Danish company said in an advisory.
“We remain committed to minimising the impact on our customers’ supply chains and will continue to keep them updated on the situation. Once the situation stabilises and the security situation again permits, we will continue to prioritise the Trans-Suez route for ME11 and MECL services as it is the fastest, most sustainable and most efficient way for us to serve our customers,” it said.
France-headquartered CMA CGM also said it “continues to take all necessary measures to safeguard its vessels and protect customers’ cargo including the following immediate measures:
- All vessels inside Gulf, and bound to Gulf, have been instructed with immediate effect to proceed to shelter.
- Passage through the Suez Canal has been suspended until further notice, and vessels will be rerouted via the Cape of Good Hope.”
At the same time, CMA CGM announced that an emergency conflict surcharge (ECS) will apply for all cargo types starting March 2 ranging from US$2,000 to $4,000 depending on the container size and type.
The ECS will be imposed on cargo in the following lanes: From or to Iraq, Bahrain, Kuwait, Yemen, Qatar, Oman, United Arab Emirates, Kingdom of Saudi Arabia, Jordan, Egypt / Port of Ain Sokhna, Djibouti, Sudan, Eritrea
Chinese carrier COSCO Shippines Lines, the fourth largest, said: “We are currently evaluating contingency plans for all cargo onboard the affected vessels, including potential alternative discharge ports, in full compliance with the relevant provisions of our Bill of Lading Terms and Conditions.”
German group Hapag-Lloyd was among the first to announce a suspension of transit, saying, “The safety and security of our crews, vessels, and your cargo remain our highest priority… We are closely monitoring developments, which are very fluid, and remain in continuous contact with authorities and security partners.”
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