How shipping insurance rates are rising, as Hormuz, Bab al-Mandeb shut down
Yemen’s Iran-aligned Houthi group announced a blockade of Saudi Arabian ports and ships in the Bab al-Mandeb Strait, which connects the Red Sea to the Indian Ocean, earlier this week.
The S&P report quoted Marcus Baker, global head of marine, cargo and logistics at Marsh – a US-based insurance and risk management firm – as saying that insurance companies are charging a bit more for risk in the Red Sea and that perceptions of risk have risen, although not to the same extent as in the Strait of Hormuz.
Maritime insurance prices have soared amid shipping disruptions in the Strait of Hormuz and are also rising for vessels traversing the Bab al-Mandeb, with both waterways – critical channels for the global economy – now theatres of war.
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