Israel-Hamas war could disrupt shipping, spike freight rates, but S’pore unaffected for now, reveals a Straits Times news source.
Container shipping ports in Singapore
Container shipping ports in Singapore have so far not been impacted by the conflict between Israel and Hamas, despite reports of congestion and a backlog of cargo at the Israeli ports of Haifa and Ashdod, as well as the closure of smaller ports around the coastal Gaza enclave.
“Israeli ports handle about 0.4 per cent of the world’s container throughput, so disruptions to the global container trade flow are limited. Impact on Singapore’s container volumes is very minimal,” a spokesman for Singapore port operator PSA told The Straits Times on Tuesday.
Nevertheless, the Maritime and Port Authority of Singapore (MPA) is monitoring the security situation in the Middle East amid global concerns that the conflict could trigger broader regional tensions, a spokesman said.
Shipping and logistics platform Container xChange
Should it spread beyond Israel and Gaza and turn out to be long and drawn out, the conflict could introduce risks to two vital shipping choke points in the Middle East, said Mr Christian Roeloffs, chief executive of shipping and logistics platform Container xChange.
The two choke points are the Suez Canal in Egypt, a critical maritime trade route connecting Europe and the Middle East to Asia; and the Strait of Hormuz between Oman and Iran, the only waterway enabling oil to be transported from the Gulf region to the Indian Ocean and beyond.
Said Mr Mick Aw, senior partner of maritime consultancy Moore Stephens: “If the Suez Canal is affected, ships will have to take the longer route around Africa. This will significantly increase the cost of shipping from places like Europe to Asia, including Singapore.”
In 2021, when passage through the Suez Canal was blocked for weeks by a large container ship that ran ashore, the cost to ship a 40-foot container from China to Europe reportedly almost quadrupled to US$8,000 (S$10,970) from rates a year prior.
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Source: The Straits Times
