Red Sea Crisis: Impact on Global Shipping and Trade

Houthi attacks in the Red Sea have caused a rapid surge in ocean freight rates, surpassing the speed of increase seen during the initial phase of the Covid-19 pandemic, according to Xeneta. Shipping costs on main routes from the Far East to Europe have risen over 200% within the first 52 days of the crisis, leading to disruptions and suspicions among shippers about carriers trying to maintain high rates. While the crisis's immediate impact is significant, it's not expected to be as long-lasting as the pandemic, and rates are anticipated to decrease once carriers can handle the capacity shortage in the Far East.