UKMTO warns shipping industry against rising Middle East tensions
UK-based maritime intelligence agency United Kingdom Maritime Trade Operations (UKMTO) warns that escalating tensions in the Middle East may once again impact the Red Sea shipping route.
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Key routes transporting Persian Gulf oil and natural gas to Europe and the US include the Suez Canal, the Sumed pipeline, and the Bab al-Mandab Strait in the Red Sea.
The UKMTO's published advisory note states that it was made aware of the escalating tensions in the Middle East that may lead to increased military activity “having a direct impact on mariners.”
The agency has advised caution to commercial vessels passing through the Persian Gulf, the Gulf of Oman and Straits of Hormuz. The agency did not, however, specify any recent incident prompting the alert.
Officials from the US and Iran are to hold talks later this week on the latter’s nuclear enrichment programs, Reuters reports.
Washington has threatened to take military action if the talks don’t yield any positive outcome. Iran has retaliated to the threats and said it could strike US bases in the region if the situation worsens, the report adds.
Oil market analysts speculate that these disruptions could jeopardise global crude oil supplies as many oil companies use these trade lanes to ship their oil tankers and vessels globally.
Brent crude’s price has gained some momentum following the news, analysts noted. “The US on Wednesday began withdrawing non-essential personnel from parts of the Middle East amid heightened tensions with Iran, prompting a resurgence in the geopolitical risk premium in crude,” Vanda Insights’ founder and analyst Vandana Hari said.
The ongoing attacks in the Red Sea shipping lane has forced shipping companies to reroute vessels via the Cape of Good Hope, adding about 3,000 nautical miles and 10 extra days to voyage-time to each trip, global insurance company Allianz Commercial said earlier. The additional cost to cover this extra voyage-time has put pressure on global supply chains.
By Aparupa Mazumder
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