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| Impact of Houthi Attacks on Red Sea Shipping Routes on Carbon Emissions |
Ongoing assaults by Houthi rebels in the Red Sea region have compelled numerous vessels to alter their routes since December 2023, resulting in a notable surge in carbon emissions. Instead of traversing the Suez Canal, ships are now navigating around South Africa’s Cape of Good Hope, extending the voyage duration between South Asia and northern Europe by at least a week.
Carbon Emission Ramifications:
- An analysis by consultancy INVERTO, a subsidiary of Boston Consulting Group Inc., indicates that the additional fuel consumption from these route diversions has resulted in:
- Approximately 13.6 million extra tonnes of CO2 emissions over the preceding four months.
- This quantity equates to the emissions produced by roughly 9 million cars during the same timeframe.
- These supplementary emissions pose challenges for companies reliant on ocean freight to curtail pollution throughout their supply chains and attain their net-zero objectives.
Implications for Shipping Firms:
- To align with emission reduction targets, companies must:
- Mitigate emissions elsewhere in their supply chains, or
- Allocate resources towards additional carbon offset initiatives.
- Both alternatives carry financial implications and may affect the profitability of shipping enterprises.
Carbon Emissions in the Shipping Sector:
- The shipping industry facilitates 80% of global trade and constitutes a significant contributor to worldwide carbon emissions.
- The International Maritime Organization (IMO), the industry’s primary regulatory body, is developing the inaugural global carbon levy, slated for enforcement in 2027.
Additional Insights:
- A distinct report by Xeneta, a freight-analytics firm based in Oslo, focused on container shipping, unveiling a 63% upsurge in carbon emissions along the Asia to Mediterranean route in Q1 2024 compared to Q4 2023.
- The Xeneta and Marine Benchmark Carbon Emissions Index reached its pinnacle in Q1 2024, marking the highest level since its inception in 2018.
- Ships are compelled to operate at heightened speeds to compensate for extended distances, consequently leading to amplified carbon emissions. The average velocity of the world’s largest container ships escalated from under 15 knots to over 16 knots following the escalation of Red Sea attacks in December 2023.