Marine war risk rates for ships transiting Israeli waters have spiked to around 0.7% following the escalation of tensions with Iran on Friday, three senior marine market sources told The Insurer.

The sources said that rates in relation to Israel had trebled relative to last week prior to the conflict’s escalation.

Iran and Israel have traded attacks since Friday, with missile strikes on major Israeli cities as well as nuclear and missile facilities in Iran leading to civilian casualties on both sides. These strikes included attacks on Israel’s northern port city of Haifa, which also damaged the nearby Bazan Group-run oil refinery, the country’s largest.

The three senior marine sources said that additional war risk premiums in the Red Sea are currently around 0.25% to 0.3%, while war risk premiums for the Persian Gulf are around 0.2%.

Two senior broking sources said rates in the Red Sea and Persian Gulf had fallen over the last few months due to increased competition from the war risk market. However, they said that there had been an increase in the risk following Friday’s escalation.

Munro Anderson, head of operations at Pen Underwriting’s marine war risk specialist Vessel Protect, said earlier this week that Iran has shown in previous times of regional sensitivity that it has the capability to disrupt commercial shipping activities in the Persian Gulf and Gulf of Oman.

Electronic interference with commercial ship navigation systems has surged in recent days around the Strait of Hormuz and the wider Gulf, which is having an impact on vessels sailing through the region, naval forces said on Monday.

Iran has not commented on reports of electronic interference.
Source: Reuters