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Recent Developments: Geopolitical instability

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Geopolitical instability is increasing in many regions, resulting in many risk challenges Photo. www.red24.com


During 2015, risks to shipping in the Middle East Gulf and surrounding waters escalated as politically charged disputes took hold. In May, a Turkish cargo ship was shelled from the Libyan coast as it approached Tobruk port and then attacked from the air as it tried to leave the area[i].

The attack on the Tuna-1 killed the ship’s third officer and marked the second fatal strike against merchant shipping by the Libyan government’s air force in 2015. In Yemen, the ongoing war and blockades had not affected ships sailing through the Gulf of Aden at time of writing, but calls at the country’s ports had been curtailed, with Aden accepting a fraction of the calls it handled before the dispute.

In North Africa, the Egyptian Armed Forces officially declared a “state of war” in July 2015. Again, the war and disputes there has not had a notable effect on shipping, but with Egypt’s control of the critical shipping chokepoint, the Suez Canal, shipping is keeping a watchful eye on events in this country. AGCS’ Khanna points out that while there are certainly physical risks to consider, there are also operational risks to shipping through unexpected port closures and delays to vessels, not forgetting economic impacts that need to be considered.

Gerhard warns that while additional insurance coverage can provide financial protection, ship operators should take adequate precautions when operating in sensitive areas. “Operators must remember that the provision of war insurance does not mean that the taking of cargo from this area is safe; insurance should not be viewed as a safety blanket.”

<Insert world map from top of p23 with caption - Geopolitical instability is increasing in many regions, resulting in many risk challenges Photo. www.red24.com>


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[i] http://www.mfa.gov.tr/no_-148_-11-may-2015_-press-release-regarding-the-dry-cargo-ship-attacked-off-tobruk_libya.en.mfa