Andrew Craig-Bennett gives his take on shipping and the Middle East.
Well, isn’t life just wonderful! We have, for most practical purposes, one of our forebears’ favourite things, a Suez Canal closure! Just when the freight markets ought to be heading downwards, we are having a splendid time, because this closure has now gone on for long enough for our very favourite thing, port congestion, to kick in along with lots of out-of-position boxes, for those of us in the box business, nicely in time for our industry’s favourite party, Posidonia.
It’s time to rain on the parade.
We must all remember that, officially at least, this party can be stopped faster than most. President Biden took a shot at stopping it three days ago. He might succeed. If the Houthi crime family (that is what they are, a crime family, not “rebels”) run out of excuses for shooting randomly at ships (and it is random) the party is over. If Israel and Hamas stop shooting at one another, the Houthis run out of excuses. It will take a few weeks to get ships and cargoes back into their usual positions, but the party will be over.
Once this happens – and it could happen at any moment now – we go back to normal. Too many ships on order, the Great Fuel Muddle and a nagging feeling that world trade might not keep growing in the way that we are all used to, in terms of ton-miles by sea, because nation is, shall we say, less inclined to speak peace unto nation.
We don’t know what the fuel of the future is, but we know what the fuel of the next 10 years is; it’s dual fuel. Which helps nobody to plan anything, much. Dual fuel can mean a ship which actually can close and open a few valves and change fuel, or it can mean the footings for the tanks for the other fuel have been included in the block sections. In our business, we generally mean the latter, and we hope that nobody asks exactly what we do mean.
World trade might not keep growing in the way that we are all used to
The shipping industry hasn’t made much fuss about the Houthis firing assortments of missiles at ships because, let’s face it, this suits everyone who isn’t actually getting shot at, and that’s an awful lot more people than are getting shot at.
The Houthis have shown themselves so ignorant of, and so careless about, who owns what ship and which ship is carrying what to where, that when (and as noted it could be any day now) their excuse for firing missiles at completely innocent seafarers is taken away from them, nobody is going to trust them anyway.
We know what this crime family really want. They want to imitate the old Barbary pirates and charge a toll for innocent passage through “their” waters and perhaps they fancy a little extra piracy on the side, into the bargain, kidnapping crews and holding them to ransom. They are enjoying themselves at the moment; they have quite literally got away with murder, and who is going to tell them to stop?
I have no trouble believing the Islamic Republic of Iran when their Revolutionary Guards tell us that they cannot control the Houthis. That’s obvious. The Iranians can supply them with arms, but they cannot make them stop until those arms run out. The Iranians can stop the supplies, but that will take weeks and months, and we all know that the arms trade finds unexpected paths to deliver killing implements anyway.
This gives the regular merchant shipping industry a dilemma. Do we really (really?) want the Houthis to stop? Our distant ancestors were pretty relaxed about paying off the Barbary Corsairs until the brand new American republic came along and had no money to buy them off with, so they fought them.
The same probably applies here. The Houthis will probably be around until they really annoy someone, and get invaded.
