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17 Feb, 2024 08:41

Asia-to-Europe shipping costs up 400% – EU commissioner

Disruptions in the Red Sea have also increased delivery times on some routes by up to 15 days, Paolo Gentiloni has said
Asia-to-Europe shipping costs up 400% – EU commissioner

The disruptions to shipping caused by Houthi rebel attacks on vessels in the Red Sea have raised the cost of transporting goods on some China-to-Europe routes by around 400%, according to European Economy Commissioner Paolo Gentiloni, who also mentioned that shipping times on such routes had increased by 10-15 days.

The commissioner expressed hope that the crises on one of the world’s most important trade routes won’t lead to a significant increase of inflation in the EU, but added that “further supply disruptions could lead to higher prices.”

The Yemen-based Houthi rebels have carried out dozens of drone and missile attacks on commercial vessels moving across the Red Sea since the beginning of the Israel-Hamas war in October. As a result, many major shipping companies have stopped using the Suez Canal and are instead redirecting ships around the Cape of Good Hope in southern Africa. 

The attacks have also reportedly caused average container prices to double globally in the past month, while fuel tanker rates for certain destinations have surged to their highest level in years.

Last month, EU foreign ministers reached a tentative agreement to launch a naval mission in the Red Sea to defend cargo ships. Germany, France, and Italy proposed the move in response to requests from the Netherlands, whose merchant shipping industry has been particularly impacted by the attacks. 

The bloc’s top diplomat, Josep Borrell, has said that the mission is expected to be launched on February 19.

For more stories on economy & finance visit RT's business section

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