India has deployed missile destroyers in the Arabian Sea in response to a recent drone attack on a chemicals tanker off its west coast. Market participants are warning of potential increases in previously stable war risk premiums.
Escalating War Risk Concerns
The drone attack on a chemicals tanker near India’s west coast has prompted heightened security measures, with concerns over the stability of war risk premiums in the Persian Gulf and the Arabian Sea. Risks could extend beyond the current area of attacks, impacting global shipping routes.
Economic Ramifications and Security Measures
As the prospect of rising war risk premiums looms, charterers are grappling with increased freight costs. The longer route via the Cape of Good Hope is gaining popularity for moving cargo from the Persian Gulf to Europe. India has responded by deploying missile destroyers and enhancing security measures in the region to deter potential threats.
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Source: S&P Global
