Israel says Houthi attacks are having a limited impact on their trade

Houthi attacks in the Red Sea are having a limited impact on Israel’s trade as maritime transport revenues account for just 3% of the total value of its imports, Reuters reports, citing a report from Israel’s Finance Ministry. The disruptions have not spurred inflationary pressures with the country’s supply chains, commodity and energy prices holding steady, the ministry added.

The tensions have also not spurred a rush towards air freight and the uptick isn’t expected any time soon, CEO of Kuehne + Nagel Stefan Paul told Reuters. A shortage in sea freight containers could have yielded an uptick in demand for air freight, but sea freight volumes seem to have normalized since 4Q 2023, Paul said.

A fire has broken out aboard a vessel southeast of Yemen’s Aden Port following an explosion nearby, Reuters reports, citing UKMTO and British security firm Ambrey. No casualties have been reported and crew are combating the fire, the newswire said. The vessel in question has not been named so far, but Ambrey has disclosed that it is Israel-affiliated and was en route to Djibouti from Singapore.

A livestock carrier carrying 14.5k livestock has set sail from Australia to Israel two months after the vessel back tracked mid voyage due to disruptions, Reuters reports. MV Bahijah will take a route that avoids the Red Sea, the newswire said, citing exporter statements. Livestock aboard the vessel were stranded for weeks offshore after the voyage was abandoned due to Australian quarantine regulations, with the period between the vessels original sailing date on 5 January and mid-February causing the deaths of 64 sheep and four cattle aboard the vessel, the newswire added, citing a statement by Australia’s agriculture ministry.

Singapore’s low sulfur fuel oil (LSFO) arrivals from the West are set to decline for their second consecutive month, as Red Sea disruptions make arbitrage economics on fuel trades less viable, S&P Global reports. The bunkering hub is slated to receive some 1.4 to 1.7 mn metric tons (mt) of LSFO in March, down from February’s 2 mn mt, the outlet said citing trade sources. Despite lower incoming arbitrage volumes from Europe and Brazil this month, the market is expected to be adequately supplied in the short term due to shipments from Kuwait’s Al Zour and ADNOC’s Ruwais refinery, as well as subdued demand at the tail end of the Lunar New Year, the outlet said citing traders.

SOUND SMART- Arbitrage economics in the Singapore bunkering market refers to trades that exploit price differentials of fuels at different locations, whereby traders make gains by buying cheaper volumes and selling them at higher prices at a different location.