Global Shipping Routes Under Siege: Escalating Wars and Climate Hazards Drive Soaring Freight Costs
Crude and fuel shippers on a global scale are contending with a surge in reservation expenses for certain tankers that are taking extensive detours to evade disruptions at the Suez and Panama canals.
The chartering costs for Suezmax vessels, the largest category of oil tankers capable of navigating the Suez Canal with full tanks, have skyrocketed as more ships choose to circumnavigate Africa to steer clear of security threats in the Red Sea.
These vessels, capable of transporting one million barrels of oil at maximum capacity, are frequently employed to convey crude from Russia or the Mediterranean Sea to Asia, as well as to transport oil from the Middle East to Europe.
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Rates for another class of ships known as long-range tankers also jumped. They can move about 600,000 barrels of oil, and are used to carry crude and fuels such as diesel and naphtha through the Suez and Panama canals.
LR-tankers, sometimes referred to as Panamaxes, have also been impacted by diversions from the Panama Canal, where record-low water levels have contributed to a snarl.
In recent weeks, attacks by Iran-backed Houthi rebels in the Red Sea have caused panic across the shipping industry, with everything from oil to container vessels targeted as the Israel-Hamas war spreads across the region.
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