New DIA report details effects of Houthi attacks on international trade

Image: DIA

The U.S. Defense Intelligence Agency (DIA) has released a new report detailing how Houthi maritime attacks have affected international trade and are supported by an expansion of military capabilities with help from Iran.

The report, “Yemen: Houthi Attacks Placing Pressure on International Trade,” follows an earlier DIA report describing the Houthis’ use of Iranian missiles and unmanned aerial vehicles to conduct attacks in the Middle East.

DIA assesses the Houthis continue to present a growing threat in the region, and their actions are detrimental to their goal to seek international legitimacy.

As of mid-February, container shipping through Red Sea had declined by approximately 90% since December 2023; shipping via the Red Sea typically accounts for approximately 10-15% of international maritime trade. Effects have been less severe in other shipping sectors carrying commodities on bulkers and tankers.

Alternate shipping routes around Africa add about 11,000 nautical miles, 1-2 weeks of transit time, and approximately $1 million in fuel costs for each voyage.

For many shipping companies, the combined costs of crew bonuses, war risk insurance (roughly 1,000% more than pre-war costs), and Suez transit fees make the additional time and financial costs traveling around Africa less expensive by comparison.

Threats to Red Sea transits are compounding ongoing stress to global mari- time shipping caused by interruptions at the Panama Canal due to drought22

As of mid-February, insurance premiums for Red Sea transits have risen to 0.7-1.0% of a ship’s total value, compared to less than 0.1% prior to December 2023.

As of February, humanitarian relief for Sudan and Yemen is being delayed by weeks and costing aid organizations more because of longer routes around Africa.

The report is notable for its tabulations of the vessels attacked, the impacts of the attacks on the economies of at least 65 countries and for a graphic plotting the attacks on a map

Access it below: