War risk costs increase for container shipping in Gulf

LONDON - Insurance underwriters have slapped on war-risk fees for all small "feeder" container shipping lines operating between Dubai and northern Gulf ports, an industry body said yesterday.

By (REUTERS)

Published: Tue 25 Mar 2003, 1:09 PM

Last updated: Wed 1 Apr 2015, 9:08 PM

The rises, which are so far much smaller than those seen during the 1991 Gulf War, directly reflect the added risk of operating merchant ships in Gulf waters assessed by underwriters last week.

Keith Nuttall, manager of the Europe Middle East Rate Agreement (EMERA) shipping line conference, told Reuters rates had risen for calls to Kuwait, Saudi Arabia, Bahrain and Iran.

"They reflect the additional cost incurred for calling at some Gulf ports," he told Reuters.

He said voyages for small vessels ferrying container freight from the United Arab Emirates to Kuwait were now being charged an extra $65 per 20-foot container equivalent units (teu).

During the 1991 Gulf War war-risk charges soared by up to an extra $250-$300 per teu depending on the port.

He said calls to Bahrain and Dammam in Saudi Arabia were charging an extra $35 per teu equivalent, while Bandar Abbas, Iran's main port, saw charges rise by an extra $25 per teu.

Nuttall also said trips from Dubai to Bombay and Karachi were charging additional fees.

"Feeder" operators ferry freight from larger deep-sea Gulf ports such Dubai where the world's major shipping lines tranship goods and commodities.

EMERA, is an alliance of nine major lines including giants like Denmark's A.P. Moeller, covering Eastbound trade between northern Europe and the Gulf.

Nuttall told Reuters he expected the major container shipping lines to report increases too, but so far no figures had been made available.

"The rises may well apply to all conferences serving the region or just one - but there are no specific figures at the moment," he said, adding that he expected to be able to produce an average figure soon.