Bombed 500 miles from Sweden - then goods become more expensive

Yemen
Shipping prices skyrocket as Israel and Yemen attack each other

Martin Palmborg

Published 14.01

An oil tanker in Yemen was attacked by Israel on Friday. Photo: AP

At least six people have died after Israel attacked Yemen for the first time - a response to the Huthi movement's attack on Tel Aviv.

- Those who harm us will pay a high price, says Israeli Prime Minister Benjamin Netanyahu.

Global trade is in the middle of the crisis – shipping prices skyrocket for sea traffic between Asia and Europe.
 

Quick version

•  Six people have died after Israel attacked Yemen for the first time in response to Houthi attacks on Tel Aviv.
• The conflict is affecting sea traffic between Asia and Europe, leading to skyrocketing freight rates.
• Shipping rates for 40-foot containers have increased by 165% due to the security situation, creating panic among businesses.

On Friday, Israel was attacked by the Iran-backed Huthi militia in Jemen, which they believe was an act of solidarity for the Palestinians in Gaza.

The Israeli army (IDF) failed to shoot down one of the rockets that exploded in central Tel Aviv. One person died and several were injured. The mistake must have been due to human error, according to the IDF.

At the same time, the Houthis claim that they can shoot down drones that are not detected by the IDF's radar system.

           

         

          Huthi rebels attacked the Liberia-flagged oil tanker "Chios Lion" on July 16 this year.  

          1 / 2

Heavy smoke development in Yemen after the IDF attack. Photo: AP

Six dead in Israeli airstrikes

On Saturday night, Israel's response came when it attacked several targets in the Yemeni port city of al-Hudaydah. It is the first time the IDF has carried out attacks against the country, The Times of Israel reports.

Six people are said to have died and 80 were injured in the airstrikes, according to Reuters.

The US must have been informed of the attack in advance. The Americans themselves have avoided striking the port as it was used to bring in humanitarian aid to the war-torn country.

On Sunday, the Houthis again sent a rocket towards Israel but it was shot down by the IDF, writes The Times of Israel. 

         

           

         

          The Houthi militia. Archive image.
          1 / 2Photo: Wael Qubady / AP 

It was at the turn of the year that the conflict around the Red Sea began to escalate after the Houthis' repeated attacks on commercial maritime traffic. . In January, the United States and Britain carried out a joint attack in Yemen when they bombed 60 targets in 16 different cities.

The security situation has caused sea transport through the Bab al-Mandab strait, outside Yemen, to decrease sharply. Israel's only port to the Red Sea, located in the town of Eliat, has had to suspend all operations, Maariv reports.

Several shipping companies have also rerouted traffic from Asia and instead round the southern tip of Africa. But the detour leads to higher prices and longer delivery times.

- The companies are starting to panic a little, they are getting worried. They start sending more goods to hedge against future problems. It creates an artificial increase in demand, says Patrik Berglund, head of shipping technology company Xeneta, to E24.

Much of the freight traffic between Asia and Europe usually goes off the coast of Yemen, but now many shipping companies choose to sail around the southern coast of Africa instead - with skyrocketing freight prices as a result. Photo: Google Earth

Photo: AP

Shipping prices have increased by 165 percent

In the past two months, the price of shipping a 40-foot container from Asia to Europe has increased by 165 percent, according to an overview from Xeneta.
- Slowly but surely, all other trade routes are starting to rise in price as well. After all, we are talking about prices that in the fourth quarter were below $1,000, which are now at $8,000 and