AMSCI statement on shipping risks in the Persian Gulf and Red Sea

The American Metals Supply Chain Institute (AMSCI) is closely monitoring developments affecting maritime trade routes in the Persian Gulf, Strait of Hormuz, Gulf of Oman, and Red Sea corridors.

Heightened security concerns in these strategic waterways, combined with recent adjustments to war-risk insurance coverage by major underwriters, are contributing to market uncertainty and operational reassessments by shipowners. These dynamics are manifesting in higher insurance premiums, potential vessel diversions, and contractual risk evaluations that are already affecting global freight markets.

As discussed on Bloomberg TV’s China Show on March 2 by Anton Posner, CEO of Mercury Group, these conditions are creating immediate uncertainty for vessels transiting critical chokepoints and for shipowners evaluating whether and when to commit to voyages into, through, or out of the Persian Gulf.

Posner emphasized that: “Whether vessels will be able to safely transit these regions, and under what insurance terms, remains a key question for owners and charterers alike.”

He also noted that: “While many ports continue to load and discharge cargo today, the primary focus for maritime stakeholders is on transit feasibility and risk management.”

These developments have implications for the movement of energy products, fertilizers, aluminum, and other raw materials central to the metals and manufacturing sectors. Delays, rerouting around longer passages such as the Cape of Good Hope, and constrained vessel availability could place upward pressure on freight rates and disrupt supply chain reliability in the near term.

AMSCI members are actively evaluating these operational, contractual, and risk management considerations as the situation evolves, and the Institute will continue to provide timely updates.

AMSCI supports the safe and uninterrupted movement of global commerce and stresses the importance of maritime security and stability in maintaining resilient supply chains.