How a Ukraine-Russia Conflict Impacts Shipping

By Salvatore R. Mercogliano, Ph.D.

The escalation in tension between Ukraine and Russia has many wondering what impact such a potential conflict could have on international and American shipping. The tension between the two nations stems from the breakup of the Soviet Union in 1991. In 2014, Russia annexed the Crimea, which denied Ukraine their largest port, Sevastopol.  

Continued escalation along the border, in the Donbass region, has led to a low intensity conflict between these nations. As Russia moves large number of forces along the border in both Russia and neighboring Belarus, concerns have emerged over a larger conflict.  

Both Ukraine and Russia are major exporters of corn and wheat and, therefore, major food suppliers around the world. Add to this, Russia provides nearly one-third of the natural gas to Europe and is a major player in world energy sectors.  

As Russia curtails shipments of LNG, American cargoes and LNG tankers from around the world have been diverted to delivery cargoes to Europe. Any conflict, or even the threat, has the potential to interdict or raise the price of such commodities around the world.  

Should the United States decide to intervene and deploy forces to Europe, its ability to respond will be constrained by geography and an aging and diminished strategic sealift force and American merchant marine.  

How America’s Military Can Sealift to Ukraine | What’s Going on With Shipping?

In August 1990, when the United States sent forces to defend Saudi Arabia, it was able to tap into those that were designed to counter the Soviet Union during the Cold War. Three decades later, that ability has diminished.  

Should the US intervene, beyond forces already stationed in Europe, and those that could be airlifted in quickly, such as the 82^nd Airborne Division at Fort Bragg, North Carolina, the military would have to rely on preposition stocks. Both the Army and Marine Corps maintain unit sets of equipment throughout Europe which only require the fly-in of personnel, aircraft, and select equipment.  

Both the Marines and Army have afloat assets. Originally the Marine Corps, through the Navy’s Military Sealift Command maintained three squadrons of ships which could each offload and support a 16,000-person Marine Expeditionary Brigade for thirty days. In 2012, Squadron One in the Mediterranean was dissolved, and its assets rolled into the other two squadrons or added to the strategic sealift fleet.  

These ships could be sent to Europe but would require prolonged transits from their bases at Diego Garcia in the Indian Ocean or the western Pacific. The ships would be exposed during prolonged transits of maritime chokepoints in the South China Sea, Straits of Malacca, Bab al-Mandab and Suez Canal into the Mediterranean.

In addition to the Marine Corps, the Army maintains a heavy brigade afloat along with ammunition and equipment across six LMSRs and two chartered container ships. Similarly, the US Air Force also has two chartered container ships, and all are based between Diego Garcia and the western Pacific. 

To move large forces from the continental United States would require the use of government-owned ships held in reserve. This surge sealift fleet includes 41 ships in the Maritime Administration’s Ready Reserve Force and 7 vessels operated by the Navy’s Military Sealift Command. These 48 ships draw their personnel from the active US merchant marine are maintained in a five-day reduced operating status. 

The issue with the reserve fleet has been the age of the vessels, on average over 40 years, and their reliability. In a test in September 2019, an activation of the fleet netted an overall readiness of 40 percent, well below the 85 percent threshold set by the US Transportation Command. Several of these ships are currently activated to support routine transportation of Department of Defense equipment and units since commercial ships are heavily booked due to the ongoing supply chain problems.

Lastly, the military would draw upon the 60 U.S.-flagged ships in the Maritime Security Program. These ships, a mix of roll-on/roll-off and containerships would be essential in supplementing the surge fleet and ensuring the shipment of sustainment cargo for any American force overseas. There is the option for the use of foreign-flagged commercial ships, but should conflict escalate with Russia, then their availability could be in doubt. 

One of the most pressing concerns would come from the vast and large submarine fleet held by the Russians. While some may doubt the ability of Russian submarines to stage a merchant ship offensive akin to that of the Germans in the world wars, in truth, merely the threat of such an attack would have massive ramifications.  

Even the largest operating companies, including those based in NATO countries, would have to pay escalating insurance costs to operate in potentially hostile waters. The issue of war-risk insurance, or the danger of losing one of their large containerships with billions of dollars of cargo onboard, may lead to ship operators laying up ships or refusing to sail them into contested seas.  

The other form of attack, and the most likely, would be asymmetric.  Specifically, Russia could launch targeted and consistent cyber-attacks against any firms working with Ukraine, the U.S., or its allies. Most container lines have been a subject of such attacks in the past, with Maersk suffering the severest one in 2017 and cost them billions.  

Once ships arrived in Europe, they would need a secure port to offload. A transit into the Black Sea via the Bosporus and Dardanelles, is unlikely. This leads to the use of ports in the Balkans or northern Europe. With countries, such as Germany, expressing reservations, offloading in western Europe may not be possible without transit rights. Any offload in a Baltic port, while it is done routinely for NATO exercises, will become more hazardous.   

No matter the choice, any movement of supplies in support of Ukraine would take days, weeks, or even months to arrive in Europe. The decline of the US merchant marine, the aging sealift force, and the failure of the Department of Defense to launch a successful recapitalization effort means that the US is in a position worse than it found itself in anytime since the First World War.