The US Navy is back fighting the forgotten war in the ‘Gate of Tears’

All that stuff under the Christmas tree mostly came by ship, you know

Ninety per cent of everything is shipped by sea, whether that’s the chair you’re sitting on, the phone you’re reading this on or the fuel that’s keeping your lights on. Shipping tends to work on long lead times, which means that right now a lot of this year’s Christmas presents are en voyage.
As an island nation and net importer, we British are highly dependent on the uninterrupted global trade of products, energy and information by sea. Cut that flow off and we perish. Disrupt it and prices go up and delays are incurred. This is what has been happening in the Red Sea since late last year as 66 per cent of ships which would normally travel through it, and over 90 per cent of the more valuable ones, are using alternative routes due to the Houthi threat.
Shipping has an amazing ability to self-heal in response to situations like this. It is a living organism with multiple stakeholders including shipping companies, ports, customs, insurers, brokers, banks and regulatory bodies. It spans global supply chains, navigating maritime laws, international treaties, and environmental regulations. Trade and profit are at its core and shippers will find a way. Initially, markets are shocked, and insurance premiums and spot rates spike whilst everyone works out what is going on, but soon enough the graphs settle down.
But while the various trading graphs do settle to a degree where people like us lose interest, they don’t settle where they were before. Usually, the shippers have to pay more in insurance or fuel or whatever and it doesn’t take long for that tab to end up with us, the consumer. 
The second important point is that the major shipping companies, despite making a decent profit out of this situation for now, don’t want going round the Cape of Good Hope to become the new normal. This is why the Suez Canal was built in the first place – it is more efficient for most traffic between Europe and the East to travel via the Canal, entering and leaving the Indian Ocean via the Bab-el-Mandeb strait at the southern end of the Red Sea. The Bab-el-Mandeb is definitely well named these days – it is the ‘Gate of Tears’ indeed. Noise emanating from those making a quick buck from the current disruption sometimes masks this obvious strategic point.
And for ships going around, the problems caused by this reduction in efficiency are slowly mounting. A P Moller-Maersk, the second largest shipping company in the world, said last week:
“These disruptions have led to service reconfigurations and volume shifts, straining infrastructure and resulting in port congestion, delays, and shortages in capacity and equipment”. Maersk also warned of a “cascading impact” on trade routes between Asia and Europe. Someone from MSC, the largest shipper, said the same to me in private months ago.
The longer journey is not only causing congestion issues, it is increasing engine hours, decreasing hull life and worsening emissions. It is also riskier, especially at this time of year. The Cape of Good Hope was originally known as the Cape of Storms, and it was well named. In July, CMA CGM’s ship the Benjamin Franklin lost 44 containers over the side during a storm. Anyone with a sensible long-term view of all this thinks that shipping needs at some point to go back through the Red Sea. 
The solution is as it has been all along – for the Houthis to stop shooting. This can only happen one of three ways, they decide to stop, are pressured into stopping (most likely by Iran) or are made to stop. 
None of these seem particularly likely just now. First, the Houthis are gaining too much influence and notoriety from their campaign to stop of their own accord. This will be far in excess of what they would have expected when they first used Gaza as a reason to start shooting indiscriminately at merchant shipping. 
Second, the US and others will undoubtedly be leaning on Iran to dissuade them but the regime there either isn’t passing that on or they are and it’s not working. 
Third, the Houthis have learned a great deal from their Iranian backers about weapon mobility, concealment and mass, making counter-strikes against them harder than most imagine. I still think a proper bloody nose back in November would have helped, but we are way past that now: and the Houthis’ habit of placing their weapons among human shields would mean civilian casualties if the gloves came off for real. You can understand why the US has been backward-leaning here even if you don’t agree with it. The US is also one of the nations whose trade is least affected by the partial closure of the Red Sea: it trades with Asia mostly across the Pacific.
In the meantime, it’s clear from the transit statistics that defensive warship operations such as the US-led Operation Prosperity Guardian and the EU’s equivalent Aspides, coupled with a smattering of counter-strikes, are not reassuring shipping. 
If a holistic diplomatic and economic solution of the sort that defeated piracy off the Horn of Africa in the 2010s is emerging, then I’m not seeing it either. Warships, then as now, are not the solution. They are an essential part of it, and we all need more of them, but if told to do it on their own they become a high-risk, high-cost sticking-plaster.
The US Navy does at least appear to be re-engaging from a low of zero ships ten days ago. This is good news from an operational perspective but also because as long as they’re there, US leadership will be keen to keep working on the rest of the solution. A few days ago, one of the two US carriers in the region, the USS Abraham Lincoln, was seen heading for the Bab-el-Mandeb and there are now two destroyers confirmed in the Red Sea, the USS Stockdale and USS Michael Murphy. 
The US warships could, if they chose, provide cover for an operation to salvage the MV Sounion, an oil tanker that was attacked two weeks ago and has been on fire ever since. The EU-led attempt to resolve this environmental disaster-in-waiting had to abort, saying the risk of attack was too high.
This is an open goal for the US Navy to re-engage in the Red Sea, impose some order, destroy potential attackers and do it all in the name of ‘the environment’. And hopefully they will then stay and reboot Operation Prosperity Guardian. Whilst I’ve conceded this is not the solution on its own, the US Navy not even trying to resolve a situation like this suggests an unwillingness to protect Freedom of Navigation that leaves mariners and US Navy watchers deeply uncomfortable. 
Meanwhile, Houthi happy hour continues and shipping continues to go the long way around. What does this mean to us in the UK? Well hopefully, you wrote your letter to Father Christmas early this year as it is about now that the ships full of all the things you want from him are already heading our way in anticipation of the November and December rush. Shipping moves things many months in advance and here is a good example of peak demand coinciding with peak disruption. 
None of this is catastrophic. Shipping retains its organic, near-mystical ability to self-heal, for now. But we should never take this giant logistical machine for granted. Millions of tons of cargo move through the world’s arteries and unload in the world’s ports before ending up under our Christmas trees and by and large, no one cares until it stops working.
If your model warship doesn’t arrive in time for this Christmas, it’s for many reasons but one of them is because we don’t have enough real ones.