Lloyd’s Insurers Restrict Red Sea Cover for Saudi-Linked Ships as 5 Million b/d Route Faces Threat
Updated
Updated · Financial Times · Jul 24
Lloyd’s Insurers Restrict Red Sea Cover for Saudi-Linked Ships as 5 Million b/d Route Faces Threat
3 articles · Updated · Financial Times · Jul 24
Summary
Leading marine war insurers at Lloyd’s told brokers on Friday they will stop selling war cargo cover for vessels with any Saudi “touchpoints” in the Red Sea, and some are preparing to cancel existing policies.
The pullback followed Houthi attacks on the Saudi-flagged tankers Encelia and Layla and a Monday warning that ships calling at Saudi ports would be targeted anywhere within the group’s reach.
The insurance squeeze raises pressure on Saudi exports through Yanbu and the East-West pipeline route, which can handle up to 5 million barrels a day while the Strait of Hormuz remains largely closed.
Several Saudi cargoes have already U-turned to take the longer Cape of Good Hope route, while the Greek-owned Merbabu and three Bahri tankers appeared to switch off GPS signals near Bab al-Mandab.
Marsh said underwriters are increasingly treating Saudi-linked ships like US, UK and Israeli vessels already facing higher Red Sea war premiums, with broader cover unlikely until Houthi threats ease.