As Red Sea attacks continue, Maersk to divert ships 'for the foreseeable future'

New Year’s eve attack

CENTCOM reported on two separate incidents on 31 December, one being against Maersk Hangzhou, which was struck by a missile. As US naval vessels responded, they shot down two further missiles fired from Yemen, the US military group said.

"Today at approximately [20:30] (Sanaa time), the container ship Maersk Hangzhou reported it was struck by a missile while transiting the Southern Red Sea. The Singapore-flagged, Denmark-owned/operated container ship requested assistance, and the USS Gravely (DDG 107) and USS Laboon (DDG 58) responded to the ship. The vessel is reportedly seaworthy, and there are no reported injuries. While responding, the USS Gravely shot down two anti-ship ballistic missiles fired from Houthi-controlled areas in Yemen toward the ships," CENTCOM said.

Also on 31 December, Maersk Hangzhou issued a distress call reporting an attack by four "Iranian-backed Houthi small boats". 

"The small boats, originating from Houthi-controlled areas in Yemen, fired crew-served and small arms weapons at Maersk Hangzhou, getting to within 20 m of the vessel, and attempted to board the vessel. A contract-embedded security team on Maersk Hangzhou returned fire. US helicopters from USS Eisenhower (CVN 69) and Gravely responded to the distress call and in the process of issuing verbal calls to the small boats, the small boats fired upon the US helicopters with crew served weapons and small arms. The US Navy helicopters returned fire in self defence, sinking three of the four small boats, and killing the crews. The fourth boat fled the area. There was no damage to US personnel or equipment," CENTCOM said.

On 29 December, CENTCOM reported it shot down a drone and an ASBM fire by the Houthis on 28 December.

"There was no damage reported to any of the 18 ships in the area or reported injuries," the military service said.

UKMTO incident reports mirrored those from CENTCOM.

On 28 December, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced new sanctions the US said were targeting the "network financing Houthi attacks on international shipping".

OFAC specifically designated one individual and three entities it claimed are responsible for facilitating the flow of Iranian financial assistance to Houthi forces and their "destabilising activities". 

The US cited so-called Exchange Houses that move Iranian funds to "Houthi-aligned financial firms in Yemen".

“Today’s action underscores our resolve to restrict the illicit flow of funds to the Houthis, who continue to conduct dangerous attacks on international shipping and risk further destabilising the region,” US Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E Nelson said. “The United States, along with our allies and partners, will continue to target the key facilitation networks that enable the destabilising activities of the Houthis and their backers in Iran.”

Potential rate increases

Many financial analysts tracking the impact of the attacks on the cost of transporting goods have cited the potential for rate increases across multiple shipping segments. 

In one such analysis, Xeneta chief analyst Peter Sand said rates "could increase by 100%" due to the attacks and vessels being rerouted to avoid them.

Mr Sand said, “The massive spike is already here. Ocean freight carriers are desperately trying to recoup the cost of sending vessels from the Far East to the Mediterranean, North Europe and US East Coast via the Cape of Good Hope rather than heading through the Suez Canal."

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