Israel attacked Major Poets in Syrian

According to Reuters, on December 9th, two major port cities on the Mediterranean coast of Syria, Latakia and Tartus, were targeted by Israeli warplane airstrikes, resulting in the destruction of a large part of Syria's fleet. The Israel Defense Forces claimed responsibility for the attack in a statement, indicating that they targeted Syrian maritime and onshore assets.

Multiple media outlets reported that an air defense site near Latakia port and military storage facilities were among the targets of the attack. Additionally, a report in the?Times of Israel?listed military hardware and weapons production facilities as objects of the assault.

Relevant news media stated that Israel conducted over?100 airstrikes on Syrian military targets, including Latakia, on December 9th. The Israeli military claimed on December 10th that approximately 480 airstrikes?had been carried out across the country over the past two days, striking most of Syria's strategic weapons stockpiles.

The shipping industry is urged to “exercise caution in the coming days,”?with India advising all seafarers to avoid travel to Syria until further notice.

The direct impact of the Assad regime's collapse in Syria on the shipping industry is primarily manifested in Iran's “shadow fleet,”?and whether Tehran will be allowed to continue providing fuel to Syria after the political turmoil.

Iran's “Shadow Fleet”

The “shadow fleet”?is one of the means Iran uses to transport oil and other materials to bypass international sanctions. According to statistical data, in 2023, Syria imported about 90,000 barrels of crude oil per day from Iran, which dropped to 60,000 to 70,000 barrels per day in 2024.?If these crude oils are squeezed out of the Syrian market, Iran's crude oil exports may decrease by 60,000 to 70,000 barrels per day, and Iran has almost no other export markets besides China, which is already reducing its purchase of Iranian crude oil. Professionals point out that this may lead to the idling of some tankers.

The mainstream shipping industry has not been significantly affected by the political changes. “With the collapse of the Assad regime in Syria, shipping companies may adopt a cautious attitude in the coming days,”?said the head of maritime security at BIMCO.

The Indian Directorate General of Shipping also took a similar cautious stance on Sunday, issuing a statement that strongly advising Indian citizens to avoid travel to Syria until further notice. The statement further pointed out that in view of the current situation, seafarers are advised not to embark or disembark at any port in Syria.

Impact of Middle East Tensions on International Logistics

Experts generally believe that the ongoing wars in the Middle East have long-term negative impacts on the global economy and international logistics:

1.Fluctuations in energy supply and prices: The Middle East is a crucial oil and natural gas producing region globally. Conflicts in the area may affect oil and natural gas production, leading to global energy supply tensions and price fluctuations. Drastic fluctuations in energy prices can have a domino effect on the global economy, affecting transportation, industry, agriculture, and other sectors, leading to increased production costs and potentially triggering a global economic recession.

2.International shipping and trade obstructions: Some vital maritime areas and waterways in the Middle East are key transportation hubs connecting Asia, Europe, and Africa. For example, the Red Sea is one of the busiest shipping routes in the world, and the Suez Canal is a critical global shipping channel. Conflicts may disrupt shipping in these areas, increasing insurance costs for vessels and forcing some to take detours, increasing transportation time and freight costs, adversely affecting the normal conduct of global trade. Experts estimate that this disruption has raised global core goods inflation by 0.7 percentage points in the first half of 2024 and overall core inflation by 0.3 percentage points.

3.Changes in demand for China-Europe rail services: With maritime transport affected, several European countries have begun to increase their demand for China-Europe rail services, actively exploring land transport as an alternative to maritime transport logistics solutions. However, China-Europe rail services also face challenges such as limited customs clearance capacity and infrastructure stress.

4.Rising logistics costs: Conflicts in some regions increase the risk of cargo transportation, and insurance companies impose additional war risk premiums on relevant vessels, which may ultimately be passed on to shippers, leading to increased logistics costs. Additionally, port operations in some regions may be affected, potentially causing cargo congestion and increasing related costs. Due to the surge in shipping costs, international trade faces tremendous pressure, especially as the supply chains of multinational companies become more fragile, and many small and medium-sized enterprises may be severely impacted.

5.Unstable trade and supply chains: Instability in some countries and regions may lead to disruptions or obstructions in trade and supply chains, requiring companies to re-evaluate and adjust their supply chain strategies to cope with potential risks and uncertainties.

International logistics is a complex system affected by various interrelated factors.?The situation in the Middle East remains uncertain, and thus its specific impact on international logistics may also change. Companies and relevant parties need to closely monitor the situation and adjust logistics and trade strategies in a timely manner to deal with possible scenarios.

Shipping experts have indicated that shipping prices may continue to rise in the coming months. Some experts predict that in the face of ongoing uncertainty, the shipping industry will enter an era of high cost and high risk,?with shipping companies needing to increase investment in shipping safety and supply chain management. Faced with significant cost pressures, shipping companies may choose to reduce the number of voyages or increase freight rates to ensure profitability. This will lead to further increases in the prices of global goods and raw materials, with consumers facing higher living costs.

Expert analysis points out that low-cost shipping has become history. The global supply chain and trade system are facing unprecedented challenges. The course of the Middle East war will profoundly affect the global economic trend in the coming months and even years. Governments and companies around the world must prepare in advance to deal with potential economic shocks.

The forecast about high cost and high risk in shipping comes from a comprehensive media judgment and does not represent the views of E-PORTS.