Indian Transport & Logistics

Houthis launch 2 missiles, Biden says US attacks ineffective

Red Sea crisis leads to 2nd largest capacity drop, says Sea-Intelligence; Drewry World Container Index up 23%

Houthis launch 2 missiles, Biden says US attacks ineffective

U.S. President Joe Biden. (Photo Credit: BBC)

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Iranian-backed Houthi terrorists launched two anti-ship ballistic missiles at M/V Chem Ranger, a Marshall Island-flagged, U.S.-owned, Greek-operated tanker ship on January 18, 2024, according to the latest update from the U.S. Central Command.

"The crew observed the missiles impact the water near the ship. There were no reported injuries or damage to the ship. The ship has continued underway."

This was the third Houthi attack on commercial ships in three days, the update added.

U.S. President Joe Biden admitted that the attacks against Houthis "were not working."

"Are they gonna continue? Yes," Biden said, BBC reported.

Abdul Malik al-Houthi, the leader of Houthis, "called it a great honour to be in direct confrontation with Israel, U.S. and U.K."

Indian Navy's Guided Missile Destroyer INSVisakhapatnam, deployed in Gulf of Aden for anti-piracy operations, responded to a distress call by Marshall Island-flagged MV GencoPicardy following a dreone attack at 2311 hrs on January 17, 2024 & intercepted the MV at 0030 hrs on #18Jan 24 to provide assistance.

"MV Genco Picardy with 22 crew (incl nine Indians) reported nil casualties & fire under control."

(Photo Credit: Indian Navy)

US attacks Houthi missiles
U.S. Central forces attacked 14 Iran-backed Houthi missiles that were loaded to be fired in Houthi controlled areas in Yemen on January 17, 2024.

"These missiles on launch rails presented an imminent threat to merchant vessels and U.S. Navy ships in the region and could have been fired at any time, prompting U.S. forces to exercise their inherent right and obligation to defend themselves," U.S. Central Command said in its latest update on X.

"These strikes, along with other actions we have taken, will degrade the Houthis capabilities to continue their reckless attacks on international and commercial shipping in the Red Sea, the Bab-el-Mandeb Strait, and the Gulf of Aden."

General Michael Erik Kurilla, Commander, US Centcom says: "“The actions by the Iranian-backed Houthi terrorists continue to endanger international mariners and disrupt the commercial shipping lanes in the Southern Red Sea and adjacent waterways. We will continue to take actions to protect the lives of innocent mariners and we will always protect our people.”

US calls Houthis terrorists
The United States announced the designation of Ansarullah, also known as the Houthis, as a Specially Designated Global Terrorist.

"This designation is an important tool to impede terrorist funding to the Houthis, further restrict their access to financial markets, and hold them accountable for their actions," says a statement from Jake Sullivan, National Security Advisor, U.S. "If the Houthis cease their attacks in the Red Sea and Gulf of Aden, the United States will immediately reevaluate this designation."

The designation will take effect 30 days from now to allow the U.S. to ensure humanitarian carve outs are in place to target Houthis and not the people of Yemen, the statement added. "We are rolling out unprecedented carve outs and licences to help prevent adverse impacts on the Yemeni people. The people of Yemen should not pay the price for the actions of the Houthis.

"We are sending a clear message: commercial shipments into Yemeni ports on which the Yemeni people rely for food, medicine and fuel should continue and are not covered by our sanctions. This is in addition to the carve outs we include in all sanctions programs for food, medicine, and humanitarian assistance."

Red Sea crisis: 2nd largest capacity drop
The Red Sea crisis has been going on for a month now, and the current service networks are clearly in flux with a lot of uncertainty, especially on the services going from Asia to Europe, says the latest update from Sea-Intelligence.

"The red circles are all marking Chinese New Year/Golden Week where capacity declines are catered to demand shortfalls occurring because of these holidays, and as such are seen as normal market behaviour," the update added.

The two phases of the pandemic (Figure 1) are marked with green arrows – the first phase where it only impacted Chinese ports and the second when it spread globally. "We have marked the “Ever Given” event, and this is clearly seen to have the largest single impact. It should be noted, though, that part of this ended up overlapping with capacity changes related to Chinese New Year that year. Finally, we can very clearly see the Red Sea crisis. With the “Ever Given” as the only exception, this is the largest single event – even larger than the early pandemic impact."

Duration of crisis unknown variable, says Drewry
Carriers are unlikely to resume Suez Canal transits until a time when the risk of attack has been eliminated, which seems more like months than weeks away, according to the latest assessment from Drewry.

"The duration of the crisis is the key unknown variable." In the best-case scenario, if trade starts to flow through Suez again shortly, the normal market dynamic will almost immediately snap back into play and prices will ebb, as too, sadly, will public interest in this fascinating sector, the update added.

"Suez Canal diversions will inflate container shipping costs for as long as the situation lasts but trade always finds a way, even if it takes a bit longer than usual," writes Simon Heaney, Senior Manager, Container Research, Drewry.

Drewry’s World Container Index (WCI) increased 23 percent to $3,777 per 40ft container for the week to January 18, 2024, and has increased 82 percent when compared with the same week last year.

"The latest Drewry WCI composite index of $3,777 per 40ft container is the highest since October 2022 and is 166 percent more than average 2019 (pre-pandemic) rates of $1,420."

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