Abu Dhabi Boosts Hormuz Trade With Dedicated Container Shuttles

Abu Dhabi is emerging as an important link for container trade through the Strait of Hormuz.

Major Carriers Avoid Hormuz

Feeder vessels connected to Abu Dhabi-based operators continue to move cargo despite security risks and disruptions in the waterway.

Meanwhile, major international shipping companies are avoiding the route due to security concerns and ongoing disruption in the region.

The arrangement is similar to the tanker shuttle model used by oil producers, in which smaller vessels are used to carry crude to larger and very large crude carriers (VLCCs) waiting in the Gulf of Oman, according to Lloyd’s List.

Higher Cost Of Shipping

Deputy Editor of Maritime news outlet Linton Nightingale said that after the US-Iran war, the cost of shipping a 40-foot container full of cargo from China has risen by nearly 600 percent; from about $850 to more than $6,000 now.

Explaining the new container shuttle model on an industry call, Nightingale said six of the seven non-Iranian container crossings recorded in the week ending September 20 were Abu Dhabi-supported operators.

He said in early September four more crossings were also connected to the UAE capital.

“A lot of these container crossings are now being undertaken by vessels linked to Abu Dhabi or Abu Dhabi interests,” Nightingale said.

“Gulf states have been relying on shuttle tankers to carry cargoes from inside the Gulf to outside Hormuz.

“That’s allowed international buyers to avoid sending their own vessels into a high-risk area.”

Container Operators and Alternative routes

Container operators are trying to maintain critical connectivity between Gulf markets and India-Pakistan through alternative routes,

Huax founder Arsenio Longo said the ship movements showed a container network was forming around Fujairah and Khor Fakkan on the UAE’s coast, with feeder vessels handling crossings and regional connections.

“The tanker comparison is actually quite a good one, just with the transfer happening through the ports rather than offshore,” Longo told AGBI.

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