Red Sea Ship Surveillance Report: Impact on Commercial Shipping and Oil Prices

2023-12-23 11:14:57

This came in a new report by the Wall Street Journal, which revealed that tracking information collected by a surveillance ship in the Red Sea belonging to Iranian military forces was handed over to the Houthis, who used it to attack commercial ships passing through the Bab al-Mandab Strait in recent days.

Earlier this week, the Pentagon revealed plans to form a multinational naval force to protect commercial ships in the Red Sea.

Meanwhile, many of the world’s largest shipping lines, oil producers and other traders have begun diverting ships from the region, driving up oil prices and the cost of insurance.

The officials said that many ships sailing in the strait had turned off their radios to avoid being tracked online, but “an Iranian ship stationed in the Red Sea enables Houthi drones and missiles to precisely target ships.”

However, a Houthi spokesman said that the group does not need to rely on Iran for assistance in its attacks.

The spokesman said: “It is strange to attribute everything to Iran as if it were the largest power in the world. We have intelligence facilities that have proven themselves over the years.”

But a Western security official told the Wall Street Journal: “The Houthis do not have the radar technology to target ships. They need Iranian help, and without that, the missiles will fall into the water.”

The Houthi attacks prompted shipping companies to change their routes, causing many African ports to become congested with the number of ships entering their waters.

“War risk premiums for tankers traveling through the Red Sea have risen recently, making the longer route (Cape of Good Hope) less expensive for charterers,” said Vortexa energy data analyst Jay Marrow.

According to LSEG data, many tankers changed or modified their routes to avoid passing through the Red Sea.

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