Containers are piled up in Lisbon, Portugal, on 13 January 2024. Recent US and UK air strikes on Yemen are causing global shipping rates to spike, sparking fears of extended disruptions in the Red Sea, a crucial trade route. Photo: Luis Boza / NurPhoto via AFP
By Andrew Mills and Robert Harvey, Reuters
Houthi militants struck a US-owned ship carrying steel products with a ballistic missile on Monday (local time) south of the port of Aden as the group vowed to keep up attacks after US and British strikes on its sites in Yemen.
Attacks by the Iran-aligned Houthis on ships since November have impacted companies and alarmed major powers in an escalation of Israel's more than three-month war with Hamas militants in Gaza.
In the latest Houthi attack on shipping the dry bulk carrier Gibraltar Eagle was struck with an anti-ship missile off Yemen's port of Aden, causing a fire in a hold but no injuries on board, operator Eagle Bulk Shipping said.
The ship, which is carrying steel products, was continuing on its way, it said.
The Houthis had previously said they would only target Israeli ships or those en route to Israel.
Container vessels have been pausing or diverting away from the Red Sea to take the longer route via the Cape of Good Hope in response.
Ship-tracking data on Monday showed at least 15 tankers altering course in response to the escalating conflict.
LNG tankers
QatarEnergy, the world's second largest exporter of liquefied natural gas, has joined those avoiding the Red Sea, a senior source with direct knowledge of the matter told Reuters.
Qatar's Al Ghariya, Al Huwaila and Al Nuaman LNG tankers loaded at Ras Laffan and were heading to the Suez Canal but stopped in Oman on 14 January, LSEG ship-tracking data showed. The Al Rekayyat, which was sailing back to Qatar, stopped in the Red Sea on 13 January.
"It is a pause to get security advice, if passing (through the) Red Sea remains unsafe we will go via the Cape," the source told Reuters regarding QatarEnergy.
The Qatari government and QatarEnergy did not immediately respond to requests for comment.
About 12 percent of world shipping traffic transits the Suez Canal via the Red Sea.
The longer route round Africa's Cape of Good Hope, which various shipping firms have opted for, can add about nine days to the normally 18-day trip from Qatar to northwest Europe.
The Houthis have been at war with a Saudi-led coalition in Yemen for years, but have turned their sights on the sea to show support for Palestinian group Hamas.
On Sunday the United States said its fighter aircraft had shot down an anti-ship cruise missile fired by the militants toward a US destroyer. No injuries or damage were reported, it said on X.
US ally Britain said it had no desire to be involved in Red Sea conflict but was committed to protecting free navigation.
"Let's wait and see what happens," Defence Secretary Grant Shapps told Sky News on Monday regarding potential further strikes on Houthi sites.
China also called for an end to attacks on civilian vessels in the Red Sea that have placed Beijing's commercial interests at risk.
Supplies affected
With vessels pausing or diverting, some supply lines are being affected.
Carmaker Suzuki on Monday said it was halting production at its Esztergom plant in Hungary until 21 January as the Red Sea attacks had delayed the arrival of Japanese-made engines.
Front-month European benchmark gas prices on the Dutch TTF hub were down 1.6 euros at 30.00 euros per megawatt hour (MWh) in afternoon trade on Monday, LSEG data showed.
Asia spot LNG prices <LNG-AS> fell to a seven-month low of $10.10 per million British thermal units (mmBtu) on Friday, supported by healthy storage levels in Europe and northeast Asia.
Oil prices lost roughly 1 percent on Monday as the Middle East conflict's limited impact on crude output prompted profit taking after oil benchmarks gained 2 percent last week.
This story was originally published by Reuters.
