Houthi Missiles Do Far More Damage to Trade Than Ships

By Alex Longley (Bloomberg) —

Houthi attacks on merchant shipping in and around the southern Red Sea are causing widespread disruption to global trade — but the damage to individual vessels has so far been relatively light.

Since mid-November, at least 16 ships have suffered direct strikes by Houthi drones or missiles, according to data from intelligence firm Ambrey Analytics. All were able to continue their voyages under their own propulsion. Images released by the Indian Navy on Thursday following another incident showed scarring and burn marks — but nothing that would hinder navigation.

“There have been no reports of significant damage or any crew injury as a consequence of the several attacks,” said Mark O’Neil, Chief Executive Officer of Columbia Group, one of the world’s top ship-management companies.  “We do not believe that this is by accident but that it rather suggests that the Houthis are being very careful and deliberate.”

While the attacks have done enough to force a chunk of global shipping to avoid the waterway, the limited damage offers one clue why some owners remain willing to send their vessels through the route. 

It also highlights to the fine balance that both shipowners and those hiring vessels are having to tread when deciding whether to navigate the area.

Of the 16 ships, six had a status of “in casualty or repairing” while the remainder were sailing or had recently arrived at ports, making it hard to discern whether they would be repaired immediately or later.

The Houthis say they are targeting vessels linked to Israel, the US and the UK. 

Most of those carriers hit at the end of last year did have some kind of Israeli nexus. Since US and UK aistrikes on Yemen a week ago — designed to try and quell the militants — there has been a ramp up in attacks on US-owned vessels .

While 16 strikes is a large number for the industry to withstand, there have been even more failed attempts.

Since the Houthis began their attacks, there have been more than 60 incidents of some kind in and around the waterway, including everything from near-misses to hijackings and harassment by armed militants in small boats. 

“If you look at the damage that’s occurred in most of these incidents it has not been significant,” said Marcus Baker, head of marine and cargo at Marsh, one of the world’s top insurance brokers. “So far we haven’t seen a total loss caused by a missile strike.”

© 2024 Bloomberg L.P.

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