Freight rates on notice after Rubymar sinks, first ship casualty of Red Sea crisis

The sinking of the UK-owned bulk carrier Rubymar after a Houthi missile strike off the coast of Yemen threatens to cause an environmental crisis in the southern Red Sea and heightens once again the risks of commodities shipping through the critical Bab al-Mandab Strait.

The 32,211-dwt general cargo ship, which was carrying 18,000 mt of ammonium phosphate sulfate fertilizer from Saudi Arabia, sank on March 2, the ship’s broker said, 13 days after being severely damaged by a Houthi missile from Yemen and becoming the first vessel lost since attacks on Red Sea ships started in November.

“Yes, she sank,” Blue Fleet Group CEO Roy Khoury told S&P Global Commodity Insights. “No port is accepting the vessel. It is a disaster.”

The sunk vessel’s fertilizer cargo “presents an environmental risk in the Red Sea,” the US Central Command said in a statement March 3. “As the ship sinks it also presents a subsurface impact risk to other ships transiting the busy shipping lanes of the waterway.”

The Red Sea contains delicate marine ecosystems, including coral reefs, that could be devastated by the spread of the fertilizer cargo. The chance that other ships could run into the sunken Rubymar also adds another risk to entering the Bab al-Mandab.

Many commercial shippers have diverted their voyages to the longer route around the southern tip of Africa, and insurance companies stopped offering hull and machinery coverage for ship owners choosing to take the shorter Red Sea route.

The attacks had supported shipping rates until recently. Platts, part of S&P Global Commodity Insights, assessed the LR1 tanker rate for transporting 55,000 mt of clean products from the Arab Gulf to Japan at $40.15/mt on March 1, up from $31.92/mt on Dec. 1 but down from a recent peak of $92.28/mt on Jan. 25.

The Belize-flagged, UK-owned bulk carrier was hit by an anti-ship ballistic missile on Feb. 18 and sank at 2:15 am Yemen time on March 2 (2315 GMT March 1). It had been slowly taking on water since the attack while Blue Fleet Group tried to find help to salvage the ship. Appeals to ports in the UAE, Africa, Saudi Arabia and Oman were either ignored or rejected, with the broker attributing the lack of assistance to the continuing Houthi threats.

“No one came to assist in salvaging the ship probably because they feared for their safety if they did anything, as the Houthis are very unpredictable,” a regional maritime official said, asking not to be named. “At the end of the day, the Houthis are ultimately responsible for this terrible outcome, no one else.”

One port official explained the night before Rubymar sank: “The ship is floating at the moment and before a tug can take it to a shore, salvage operations need to take place. A few salvage operations companies are apparently involved in the assessment of the current state of the vessel. However it looks like that the extent of the damage is very big and most probably the vessel needs to be towed to a scrapyard so the damaged parts are scrapped before it goes to any shipyard. it is a quite risky operation, safety and security wise.”

The Houthis have been targeting US, UK and Israel-linked ships in response to the Israel-Hamas war.

In a statement late March 2, Mohammed Ali al-Houthi, the head of the Houthi Supreme Revolutionary Committee, said UK Prime Minister Rishi Sunak and his government “bear responsiblity” for the Rubymar’s sinking due to its support for “genocide and siege” in Gaza.
Source: Platts