Press Article: Tensions in the Persian Gulf increases delay exposure for shipowners
News & Insights 23 March 2020
Shipowners are turning to Strike and Delay-type coverages to help mitigate against the high cost of marine war risk insurance in the region
The Strait of Hormuz connects the Persian Gulf with the Gulf of Oman and has always been a vital route for commercial ships to access five of the world’s top 10 oil exporting countries, as well as providing a passage to the world’s largest LNG exporter. According to the US Energy Information Administration, the daily oil flow averages 21 million barrels per day, or more than 20% of global petroleum consumption.
With only Saudi Arabia and the UAE possessing capability to move oil out of the Persian Gulf via pipeline, the Strait of Hormuz remains the world’s most important choke point for seaborne oil and LNG.
During the course of 2019, a number of attacks occurred in the Gulf, not just on commercial ships but also to onshore facilities and military assets. The threat environment was notably heightened for ships transiting the Strait of Hormuz.
Paul Park, Strike and Delay Class underwriter, discusses the heightened threat in the Persian Gulf in an article for Insurance Day. The article is available on the right and the Insurance Day website here.
Category: Strike & Delay