Russia war in the Black Sea will change short sea shipping connections
Russia’s attack on Ukraine has affected not only global supply chains. Short sea shipping connections have changed drastically in Europe. The Black Sea is practically out of the game. Merchant ship traffic has dropped very drastically in Black Sea ports.
Insurance companies have identified the Black Sea as a high-risk region. Insurance contracts are terminated or war insurance is offered. Shipping companies in the Black Sea are reportedly facing war-risk premiums as high as $5 million.
A large drop in the supply of cargo in Russian seaports in the Black Sea and in St Petersburg ( – 12%) was observed in March this year. In the second quarter of this year. changes in short sea shipping will continue in all markets. The situation will worsen in the second half of this year. Prices for grain, oil and gas, fertilizers, and steel will increase further. Freight and bunker fuel prices will be high.