Marine war risk rates for ships navigating Israeli waters have surged to approximately 0.7% in light of heightened tensions with Iran, according to three senior marine market sources. This marks a significant increase, as these rates have tripled compared to the previous week before the escalation of hostilities. Since last Friday, the conflict between Iran and Israel has intensified, with missile strikes targeting major Israeli cities as well as Iranian nuclear and missile facilities. These attacks have resulted in civilian casualties on both sides, including strikes on the northern port city of Haifa.
The bombardment also impacted the Bazan Group-run oil refinery, Israel’s largest, causing considerable damage. In addition to the Israeli situation, the marine war risk premiums in the Red Sea are currently ranged between 0.25% to 0.3%, while those in the Persian Gulf are around 0.2%. Some senior broking sources mentioned that the rates for the Red Sea and Persian Gulf had declined in recent months due to increased competition within the war risk market. However, the dramatic escalation of tensions last Friday has reversed that trend, leading to an uptick in risk perception.
Munro Anderson, head of operations at Pen Underwriting’s marine war risk division Vessel Protect, emphasized that Iran has previously demonstrated an ability to disrupt commercial shipping in the region during periods of heightened sensitivity. In recent days, there has been a notable increase in electronic interference with commercial ship navigation systems around the Strait of Hormuz and throughout the Gulf. According to naval forces, this interference has significantly affected vessels operating in the region. As of now, Iran has not responded to the reports of electronic disruptions.