Recent global conflicts have raised risks for shipping, but have also helped funnel money into the pockets of owners, begging the question if geopolitical strife is actually a good thing for shipping.
“There’s a silver lining whether we like it or not,” said Yannis Litinas, partner and head of shipping at law firm Simonsen Vogt Wiigt.
“We have to acknowledge there’s a silver lining in everything.”
Litinas was speaking on a panel about geopolitics at YoungShip’s annual ShipCon conference, held this year in Oslo.
He acknowledged conflict is not something anyone wants to see prolonged, but argued there are opportunities created by Houthi attacks in the Red Sea and Russia’s invasion of Ukraine and that shipowners should take advantage of because it is the environment in which they operate.
The Houthi attacks pushed shipowners to avoid the Red Sea and opt for the Cape of Good Hope, adding tonne miles and reducing effective ship supply, while the Russian invasion completely changed global oil trading patterns.
“You have to use this. They’re not causative to whatever is happening, but trading is necessary, and yes, they will come out with more profits,” Litinas said.
“At the same time, some of those profits Norwegian owners will apply then toward the green [transition].”
Lena Falkenberg Ollestad of the Norwegian Shipowners’ Association said shipping’s gains go all the way back to 2020 and the Covid-19 pandemic and acknowledged short-term disruptions lead to gains.
“At the same time our members are concerned with what’s lying ahead,” she said.
“We have been around for 150 years, our members have a long-term perspective. These are family-owned shipowners.
“They don’t think about the next two years or three years the way other types of owners do.”
She said members were more concerned with issues like freedom of navigation.
“World War II was not a good time for shipping,” she said. “Huge conflicts are not a positive.”
