Shipping: Ship operations to become more “expensive and disruptive”

With the recent severe drought in the Panama Canal and the continuing deterioration of the Red Sea crisis, the safety and efficiency of transportation have been threatened, ship detours and waiting have become commonplace, and sailing times and costs have skyrocketed in a short period of time, the shipping industry is facing the largest challenges and risks it has faced in recent decades.

The guided-missile destroyer USS Carney in Souda Bay, Greece. The American warship and multiple commercial ships came under attack Sunday, Dec. 3, 2023 in the Red Sea, the Pentagon said, potentially marking a major escalation in a series of maritime attacks in the Mideast linked to the Israel-Hamas war. “We’re aware of reports regarding attacks on the USS Carney and commercial vessels in the Red Sea and will provide information as it becomes available,” the Pentagon said. (Petty Officer 3rd Class Bill Dodge/U.S. Navy via AP)

At the same time, fast-approaching environmental regulations are also touching the fragile nerves of the industry, and the cost of emission allowances under the EU ETS and decarbonization under the IMO emission reduction targets are putting more and more serious financial pressure on shipping companies.

It seems that the shipping industry, which is struggling through the recession and overcapacity in 2023, will find it difficult to catch its breath. With all these problems, ship operations will become even more “expensive and chaotic”.