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East Pipes CEO says shipping costs up 20% on Red Sea reroute
East Pipes CEO says shipping costs have risen 15-20% after vessels were rerouted from the Strait of Hormuz and Bab al-Mandab to Jeddah and Yanbu ports.
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East Pipes Integrated Co. for Industry is paying 15% to 20% more to ship raw materials after geopolitical tensions forced it to reroute vessels from the Strait of Hormuz and the Bab al-Mandab Strait to alternative Saudi ports, Acting CEO Mohammed Darweesh told Al Arabiya.
The company, which imports most of its raw materials through Dammam Port, has diverted shipments to Jeddah Islamic Port and Yanbu Commercial Port. Some vessels waited up to four weeks before berthing, Darweesh said.
Customer contracts include clauses that let East Pipes recover the extra shipping costs once certain conditions are met, he said.