Robert Peters, associate director of risk analytics at maritime security risk management specialist Ambrey, and Ian Wilkinson, vice president of sales excellence at Inchcape Shipping Services, survey the key security threats that emerged in 2023 and how they might develop in the next 12 months.
The number of air raid alerts per day over port cities in Israel dramatically reduced after the first couple of days of the conflict and there have been zero crew casualties or merchant vessel losses. The Hamas and the Palestinian Islamic Jihad (PIJ) capability is now largely exhausted or destroyed. As a result, the risk to vessels calling at Ashkelon and Ashdod has reduced considerably. Post-conflict security arrangements will be critical. Right now a longer ceasefire is under discussion but time will tell how this plays out.
In terms of regionalisation of the conflict, Hezbollah and some Hamas units in Lebanon joined the conflict on 8 October. Most air raid alerts have been limited to the confrontation line in northern Israel. Hezbollah has not wanted or needed a full-scale conflict. Simply displacing Israeli settlers in these areas is victory enough. Hezbollah largely respected the November ceasefire.Israel is exploring diplomatic avenues for a resolution, but has left military options on the table.
Meanwhile, the Houthis started to target Israeli territory from 19 October. Eilat port calls have fallen considerably as a result. However, due to the distance to Israeli territory and interceptions by the US, Egypt, Saudi Arabia and Israel, since 14 November they refocused on threatening merchant shipping. Threats to specific vessels decreased as vessel traffic rerouted, but have increased following the US and UK strikes. Attempted targeting by UAVs or missiles on Israeli, US or UK-affiliated merchant vessels is now likely. So far there have been no injuries or fatalities but there have been near misses, which is a threat to life.
In the short term, more vessels associated with Israel, the US and UK will re-route but purely Chinese, Russian, Greek, Singaporean and Turkish shipping is highly unlikely to be impacted. There is assessed to be a continuing Houthi threat to Israel-owned shipping after the conflict is resolved or there is a prolonged ceasefire, largely because of Houthi anti-Zionist rhetoric and local support in Yemen. They retain the capability to target vessels in an even broader area.
Egypt and the Suez Canal are unlikely to be targeted by the Houthis. Although there has been a marked decline in Suez Canal transits, there is still significant traffic. For vessels rerouting around Africa there is plenty husbandry and bunkering capacity at Gibraltar and Algeciras, also around southern Africa and at Port Louis in Mauritius. Algeciras and Gibraltar are very busy, so we advise operators to book bunkers well ahead.
Meanwhile, the de-escalation of the conflict with Saudi Arabia in the Yemen civil war will likely last, but the threat to Yemeni government-controlled oil and gas exports will persist, as this is a negotiating lever for the Houthis.
North-south Cape of Good Hope trade
Somali pirate action groups (PAGs) re-emerged in November and recently attacked two bulk carriers, hijacking the Ruen and boarding the Lila Norfolk up to 600 miles offshore Somalia. There are ongoing negotiations for the release of the former. The cause is political instability in Puntland, where the incumbent president chose not to rotate the office to the next sub-clan whose turn it was, while others have been disempowered. Access to key positions within the administration are key to revenue distribution for these sub-clans, particularly fishing licenses.
The security and shipping industry has been a victim of its own success. The suppression of piracy has led to far fewer incidents. Those occurring prior to November were limited to opportunist armed robberies inside Somali territorial waters. The high-risk area (HRA) designation due to fewer incidents deep offshore was removed while insurers also shrunk their Listed Areas much closer to the coast.
If the Ruen ransom is large, the Joint War Committee (JWC) will likely reconsider their Listed Areas. Ambrey has seen increased interest in armed guards, unarmed advisors on the bridge and its digital services already, but a lot of shipping companies will want to recover these costs and will need the JWC and charterers to recognize the extended threat and mandate the use of enhanced measures. Point-defence of vessels is essential as ships may have to wait 24 to 48 hours for navies to arrive in so vast an area.
The Iranian threat
Iran has targeted merchant vessels for two main reasons, the first related to sanctions. For example, in 2023, the US seized Iranian oil onboard the tanker Suez Rajan and issued a multimillion-dollar fine. In response, Iran seized a tanker carrying US-bound cargo and harassed other US merchant ships. Later they seized the St Nikolas (ex-Suez Rajan) when it returned to the area. This kind of tit-for-tat has been ongoing since July 2019, when the British seized an Iranian cargo off Gibraltar. Secondly, the Iranians have also been targeting Israeli-owned ships using UAVs since at least February 2021 as part of a ‘grey zone’ conflict between the two countries.
One of the implications of attacks in the Red Sea has been that merchant shipping is likely to consider bunkering towards the east and in Singapore. Although there was an increase in the number of reported incidents in the area in 2023, the risk in Singaporean anchorages is assessed to be low. Regional efforts to break organised crime groups has resulted in fewer hijackings and fuel theft. The focus is now more on armed robbery. For the sake of safety, crews should avoid confronting criminals.
West Africa piracy
In 2023, there were only three hijackings and three kidnappings involving 15 crew members – a marked reduction on previous years. Higher oil prices could lead to a disincentivization of piracy, as pirates can make more money protecting the export of illicitly refined products. Incidents that do occur are more likely to impact bunker product tankers and commercial fishing vessels. However, this business model could be disrupted by Nigerian efforts to counter the illicit trade and by counter-piracy ops by regional and international states.
Migrants and asylum seekers
There is a safety risk for merchant shipping related to the movement of migrants and asylum seekers from Africa towards Europe and the Canaries. The Senegalese and Spanish Coast Guards are active in the Atlantic resulting in fewer merchant vessel interventions. In the Mediterranean, most interventions are carried out by NGOs using their own vessels to pick up migrants leaving Tunisia and Libya. Merchant ships can get diverted towards migrant boats, which incurs fuel costs and can impact days on hire. The average impact for a merchant vessel we estimate at around USD 500,000. There is also the risk of reputational damage if they do not respond or if they return migrants to Libya or Tunisia.
Most merchant vessels are not equipped to accommodate the hundreds of people crammed into fishing boats or dozens on unseaworthy smaller boats. Managing safety is a challenge. For ships destined for Libya or Tunisia, most of these people do not want to go back. In a very few cases they have self-harmed and threatened crew, requiring military support.
In terms of merchant shipping, there was a major shift in 2023 when the UN Black Sea Grain Initiative was not renewed in July. Russian and Ukrainian forces have since targeted each other’s port facilities. The lack of damage to merchant shipping during these attacks indicates both sides want to show restraint. Sea mine events, on the other hand, offer plausible deniability. After the non-renewal of the grain corridor, the Ukrainians accused the Russians of laying bottom sea mines in the new Ukrainian unilateral grain corridor, which now seems likely. In September, two general cargo ships suffered such serious damage that they were grounded to avoid sinking while three others reported incidents. In terms of outlook, if the Russians are able to move the front line back towards Mykolaiv, more than a dozen stranded merchant vessels could once again be at heightened risk of collateral damage from missile attacks across the Southern Bug estuary.
Panama has been suffering drought conditions for several years, exacerbated by population growth and water evaporation. In July, the Canal reduced capacity to typically 32 daily slots, of which 27 were available through bookings. Recently, they have reduced that further to 24 bookings a day. The restrictions are going to continue for some time. The market has already adjusted to $300,000 to $400,000 for a free slot at auction.
The Magellan Straits have been a viable alternative route since 2021 and there was a steady increase through 2023. There are a number of transit areas but be aware that you need to pick up two or three pilots en route.
Other potential disruptions to shipping
Weather is increasingly going to impact shipping. Port Louis in particular has been closed off and on over the past few weeks due to cyclones. Civil disturbance is another potential source of port disruption, such as the situation in Ecuador and in Papua New Guinea, which is in a state of emergency. Strikes have also caused disruption in Australia and France.
One crime issue on the rise is narcotics, not only on ships heading for Europe, but also in Asia, particularly Malaysia and Indonesia and even China. Stowaways are an issue for those sailing around the Cape of Good Hope from Western Sahara. Inchcape/Ambrey offer canine narcotics inspections and stowaway inspections to mitigate these problems.
Reliable information is vital in times of crisis
Regarding all these risks, our core recommendations are, firstly, to build a network of trusted data and service providers. Inchcape’s strength is human intelligence on the ground in ports while Ambrey offers both armed security guards, unarmed liaison officers and its Fathom, Guardian and Sentinel digital platforms. Secondly, conduct thorough risk assessments for every voyage. Ensure crew are aware of the risks and trained accordingly. Remember the five Ps – Perfect Preparation Prevents Poor Performance.