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BP Plc said it will pause all shipments through the Red Sea after attacks on merchant vessels escalated, adding to signs that trade through the vital waterway is grinding to a halt.
BP’s decision, the most tangible sign of disruption to energy flows since the Hamas-Israel war started, comes days after all the world’s top container shipping lines said they were temporarily halting. Norway’s Equinor ASA made a similar announcement hours later.
The moves came as a fuel tanker was struck by an “unidentified object” on Monday, according to its owner. Attacks are now occurring almost daily. An insurance committee that evaluates maritime risk widened the area in the Red Sea that it said was the most dangerous.
The disruptions are a stark reminder of the inflationary and economic pressures that make securing the area a top priority.
The US and its allies have now formed a Pentagon led naval coalition via Operation Prosperity Guardian to protect international shipping transit in the Red Sea and vital Bab al-Mandab Strait, per a breaking development from Politico’s chief Pentagon correspondent.
Avoiding the Red Sea means sailing around Africa, adding thousands of miles to voyages and delaying cargo deliveries.
Two big oil tanker owners, Maersk Tankers and Euronav NV, also said late last week that were insisting on options giving them the right to avoid the area. On Monday, Euronav went a step further, saying it would avoid the area altogether.
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