Diesel supply from India to Europe dropped by 90%, negatively impacting the Indian business and supply chain

Shipping costs for freight going from Asia to the European Union (EU) and Britain have increased.

According to the data, only one shipment of diesel reached Britain in February. (Image: indiashippingnews.com)

Indian Business, Supply Chain: Diesel supplies from India to Europe fell by 90%: shipping costs increased due to Houthi attacks in the Red Sea, now deliveries are made in Asian countries.

Diesel supplies from India to Europe have reached the lowest level in the past two years. According to the Bloomberg report, international trade is being seriously affected by the ongoing Houthis attacks in the Red Sea.

Shipping costs for freight going from Asia to the European Union (EU) and Britain have increased. In such a situation, it has become more economical to send goods to Asia instead of western countries. Bloomberg quoted Vortexa Limited data as follows: “In the first two weeks of February, approximately 18,000 barrels of diesel reached Europe from India daily. This is about 90% less than the average delivery in January.”

Ships sailing through South Africa due to fear of Houthi attacks

Sparta Commodities analyst James Noel-Beswick said: “Exports to eastern countries such as Singapore have become much better than to western countries. Tankers bound for Europe or the Atlantic basin must pass through the Cape of Good Hope in South Africa for fear of the Houthis.

This has increased the distance, which has a direct impact on costs. They often also have to take the Suez Canal route, where insurance costs are also high due to the risk of corrosion. For all these reasons, shipping costs increase.

Diesel did not reach any EU country from India in February

According to the data, only one shipment of diesel reached Britain in February. There was no offer in the EU. However, barrels from India have recently been loaded into two ships named Marlin Sicily and Marlin La Plata, which will reach Rotterdam, Netherlands, at the end of this month.

On the other hand, an increase has been recorded in the number of diesel cargoes arriving from India to Asian countries in February. Some of these shipments also reached Bangladesh and Saudi Arabia. Goods loaded on ships such as Peace Victoria and Orange Victoria are delivered to East Asia.

80% of India's trade passes through the sea route

Between 12% and 30% of global trade and container traffic passes through the Suez Canal in the Red Sea every year. International trade on the main route between Europe and Asia is experiencing problems due to attacks by Houthi rebels.

80% of India's trade takes place via the sea route. At the same time, 90% of the fuel also comes via sea routes. Attacks on maritime routes have a direct impact on the Indian business community. There is a danger that this will spoil the supply chain.