Piracy Causes Changes in Routes, Insurance
February 6, 2010 – 1:40 pmPiracy in the waters off the coast of Somalia — particularly in the critical Gulf of Aden, connecting the Red Sea to the Indian Ocean — soared last year. Amid the rash of attacks, some lines have stopped transiting the area altogether, and shipping-insurance rates have jumped….
…The change in route also has dented revenues from the Suez Canal, which account for between 10% and 20% of the Egyptian government’s annual budget. The Suez Canal Authority charges between a few thousand dollars for a small ship to $600,000 for major container vessels.
Shipping insurance firms, mostly based in London, have been charging premiums to go through the Gulf of Aden and Suez since last spring. Big oil and chemical tankers, several football fields long, are especially vulnerable. They must pay tens of thousands of dollars a day in extra “war zone” insurance to cross the Gulf…
WSJ: Piracy Causes Changes in Routes, Insurance
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