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The pace of new containership deliveries have picked up markedly with over 309,000 teu delivered in the past month, pushing the annualised rate of fleet growth to 9.6%. The influx of new supply has not dampened the buoyant demand for tonnage with charter rates still inching upwards. The escalation of the Middle East crisis in the past week has provided a further boost to demand for containerships with the threat to shipping building up in the Persian Gulf while the Suez diversions building into an extended crisis.

The exposure of Israeli-linked ships in the Strait of Hormuz is small at the moment, but the turmoil will provide a catalyst for freight rates to rise in the coming weeks. The SCFI rose marginally for a second straight week, led by sharp gains in Latin America, Middle East and Australia while Asia-Europe and Transpacific rates have stemmed their recent declines with Shanghai freight futures to North Europe rallying sharply at the start of the week.

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Limited Israeli-owned containership exposure on Persian Gulf
The seizure of the 14,952 teu MSC ARIES by Iranian special forces on 13 April 2024 off Fujairah has placed heightened risks on Israeli-linked containerships trading in the Strait of Hormuz. However, the Israeli owned fleet accounts for less than 2% of all containerships in the Persian Gulf and their redeployment to other routes is not expected to cause significant disruptions to the trade, barring a full blockade of the Strait of Hormuz if the Israeli conflict escalates.

Out of over 500 containerships currently trading in the Persian Gulf, only 10 ships are owned by Israeli-linked interests, all of which are operated by MSC.

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