The repeated air strikes by the US and the UK against the Houthis in Yemen have not been successful in slowing down the Houthi attacks on ships in the Red Sea region, according to BBC Verify. In fact, the number of attacks on ships has increased in the past three weeks compared to the previous three weeks. The shipping using the Red Sea trade route has declined by 29% since the airstrikes began in January, which is a higher rate of decline than before the US-led action took place. The Houthis initially targeted ships connected to Israel or heading to/from Israel, but since January, they have primarily focused on ships owned or operated by the US or the UK. The attacks have resulted in a total of 28 vessels being targeted since November, with seven of them having links to Israeli companies or individuals. It is worth noting that identifying vessel ownership can be challenging due to complex company ownership structures.
The recent attacks have targeted ships further south in the Gulf of Aden, whereas previous attacks were concentrated near the Bab al-Mandab Strait in Houthi-controlled Yemeni territory. Initially, the Houthis used both missiles and drones carrying explosives, but more recent attacks have primarily involved missiles launched from Yemen. The decline in commercial ships using the Red Sea route has been substantial, with a 50% decrease since the start of the Houthi attacks. This decline has occurred despite a US-led military partnership aimed at safeguarding commercial shipping in the area. The decrease is not seasonal, and it has resulted in various consequences, including higher freight charges, increased journey times, higher crew wages, and elevated insurance costs. For instance, the cost of transporting a standard 40ft container from Shanghai to Rotterdam has risen from $1,200 in mid-November to almost $5,000 at the end of January. These rising costs are expected to put pressure on consumer goods prices, ranging from fuel to food.
As ships opt for alternative routes around Africa instead of using the Suez Canal, the canal’s governing body has experienced a significant drop in revenues. In January, the revenues dropped by 44% compared to the same month in 2023. The canal authority anticipates a further decline of 40% in revenues for this year. The impact is particularly noticeable for certain vessel types, such as container ships, which are controlled by a small number of companies. The number of oil tankers using the Suez Canal has also decreased since the Houthi attacks started, although not as dramatically as for container shipping.
Ship operators choosing the Red Sea route have implemented various measures to reduce the risk of attack. Some are paying for armed security teams on board their vessels, while others have disabled their AIS tracking systems to make it harder for the Houthis to locate them. Furthermore, some ship owners are declaring “no link to Israel” or highlighting the presence of armed guards or all-Chinese crews, believing that these factors will deter the attackers. Chinese-affiliated shipping has seen an increase, rising from 13% to 28% of all vessels passing through the Red Sea since the end of November.
