Trafigura: Diverting Ship Routes Away from the Red Sea Results in Significant Additional Daily Fuel Consumption for Shipping Companies
NYN | Reports and analyses
An analysis conducted by the global commodity trading company Trafigura has revealed that diverting oil tankers and container ships away from the Red Sea and instead routing them around Africa leads to a substantial increase in daily fuel consumption.
According to Trafigura’s estimates, this shift for ships and tankers avoiding the Red Sea and taking the alternative route via the Cape of Good Hope in Africa will result in an additional 500,000 barrels of fuel oil being burned daily this year.
The company explained that oil tankers alone will consume an extra 200,000 barrels per day when rerouted around the Cape of Good Hope in Africa, which equates to a 4.5% increase in annual emissions for this category of ships.
Trafigura, one of the world’s largest oil trading companies based in Switzerland, noted that the impact of longer voyages will lead to a daily increase of approximately 500,000 barrels of fuel consumption this year, further straining the global shipping industry amidst the disruption of traffic in the Middle East.
Additionally, the maritime logistics site The Maritime Executive reported that many ship operators had relied on the Red Sea route, which is shorter and less costly. However, ship managers are now recommending avoiding the risks entirely and switching to the longer route around South Africa.
The site added that the majority of container ship and oil and gas tanker fleets have already made this shift, adding 2,000 to 3,000 nautical miles to voyages between Asia and Europe or the United States. Furthermore, increasing ship speeds to make up for the time difference caused by longer routes results in higher fuel consumption.
In a related context, the maritime consulting firm Vespucci Maritime estimated that the additional distance covered by ships bypassing the Red Sea around Africa each week exceeds the distance from the Earth to the Moon, as they described.
Since the announcement by Yemen’s Houthi government forces of the start of the “fourth escalation phase” in May, aimed at ending the aggression and lifting the siege on Gaza, they have intensified their maritime attacks to include all ships belonging to shipping companies transporting goods to “Israel,” forcing many companies to suspend the use of the Red Sea route.
Recently, the German shipping company Hapag-Lloyd announced a 75% decline in its profits for the first half of this year, due to its cessation of passing through the Red Sea to avoid attacks by Yemen’s Houthi government forces on ships transporting goods to “Israel.”
The company reported that its profits amounted to €732 million compared to €2.9 billion in the same period last year. The company also confirmed that it added new ships and containers this year to cope with the changing security situation in the Red Sea.
It is worth noting that Hapag-Lloyd was among the first companies to decide to avoid the Red Sea after one of its ships was attacked last December. At the time, Israeli media reports indicated that the German company regularly transported goods to “Israel,” making it a potential target for Yemen’s Houthi forces.
In a related development, the shipping giant Maersk announced a 45% decline in its profits in the second quarter of this year due to attacks carried out by Yemen’s Houthi government forces, which prevented its ships from passing through the Red Sea to transport goods to “Israel.”
