Suez Canal due to piracy
MORE of the world’s big shipping
firms are quietly diverting their fleets via South Africa’s Cape of
Good Hope instead of risking Somali pirates in the Gulf of Aden, a
senior industry executive said recently.
Rob Lomas, secretary-general of
Intercargo, an industry group representing shipowners hauling dry
commodities, said more firms were avoiding Suez – an extraordinary
move in peace time.
“In hundreds of years of shipping
experience, we’ve had incidents before when the Suez Canal has been
closed – after the 1967 Arab-Israeli war for instance – but in terms
of piracy it’s unprecedented,” he said after pirates seized a Saudi
supertanker in the world’s biggest ship hijacking.
“For dry commodities, we do know
there are companies that are weighing whether they should go through
Suez or the Cape and we are aware of firms that have decided to go
via the Cape,” he said.
Lomas was careful to point out,
however, that there was no stampede by operators for the Cape and
that international seaborne trade would always get through somehow.
At least three big well-known
shipping companies, the world’s largest tug operator Svitzer,
Norwegian chemical tanker group Odfjell, and a large liquefied
petroleum gas operator have already publicly stated they are
Container ship operators too, which
carry everything from hi-fis to toys, are weighing their options.
The US navy said pirates had taken
the Saudi Sirius Star supertanker – laden with more than
US$100mil worth of oil – to Haradheere port half-way up Somalia’s
There is little evidence, however,
that big oil tanker firms carrying most of the world’s crude oil are
avoiding Suez, though many are expressing deep disquiet about Somali
Three of the Gulf’s top oil
exporting nations – Saudi Arabia, Iran and Kuwait – said they had no
plans to alter the path of their state-owned fleets because of the
Somali pirate attacks.
Lomas, who declined to say which of
his members had made the decision, said some firms could be
re-routing on commercial grounds alone.
“Companies may naturally route
through the Cape anyway for economic reasons. We have a very soft
freight market at the moment for dry-bulk commodities, so people
will assess the overall risk, including costs,” Lomas said.
He said firms would take into
account Suez Canal toll fees, bunker (fuel) costs, insurance rates
and extra voyage times.
Lomas said hull insurance rates had
risen about 10% since the summer for voyages through the Gulf of
Aden, driving costs higher via Suez.
It was not clear whether insurance
brokers were pushing rates even higher after the latest major
hijacking, though some industry experts said additional premiums
charged were likely to keep on rising.
“You mix it all in and might find
that the Cape is an attractive option anyway,” Lomas said. — Reuters