Houthis' attacks and the security risk in the region have rapidly increased war insurance costs for tankers passing through the Red Sea. While Saudi Arabia's
Houthis' attacks and the security risk in the region have rapidly increased war insurance costs for tankers passing through the Red Sea. While Saudi Arabia's efforts to diversify its oil export routes continue, increasing risk premiums in the insurance market are pushing up maritime transportation costs.
Security concerns in the Red Sea have forced tanker operators and insurance companies to take new measures. It has been reported that, with the increasing risk of attack in the region, war risk insurance premiums for tankers receiving cargo from Saudi Arabia's ports in the Red Sea have increased approximately threefold in the recent period.
In the maritime insurance market, additional premiums under war risk constitute a significant part of the operating costs of ships in the region. Increasing costs directly affect the freight calculations of tankers, especially those carrying crude oil and petroleum products.
Red Sea alternative is struggling
The Red Sea has long been seen as one of the alternative routes to the Strait of Hormuz in Middle East oil trade. However, unmanned aerial vehicle and missile attacks in the region raise question marks about the reliability of this route.
While Gulf countries, especially Saudi Arabia, are trying to use their terminals and alternative transportation routes in the Red Sea to continue their oil exports, the rise in insurance costs is creating a new pressure.
Cost pressure is increasing in the tanker market
Increased risk in the Red Sea means tanker owners face higher safety costs. Rising insurance costs increase total transportation costs along with fuel, crew and route changes.
Some shipowners are re-evaluating Red Sea and Suez Canal routes due to security risks, while the longer Cape of Good Hope route also increases time and fuel costs.
Source: SeaNews Türkiye
