Shipping: A global target.
Why shipping insurance faces the risk of multiple losses in 2026.
US President Donald Trump declared a blockade on Venezuelan oil. Thus far, the US has seized three vessels loaded with Venezuelan oil. Meanwhile, the Russia-Ukraine war is targeting shipping more frequently, while the Red Sea is becoming a more overt battle ground.
Venezuela and Latin American shipping to China
Among other things, this is a test case for China: if the Americans can cut off the flow of oil from Venezuela to China, they would likely replicate this strategy to restrict other exports from Latin America to China. Especially as the USA works to install right wing governments in Latin America.
Russia - Ukraine shipping war
Simultaneously, there is an ongoing campaign to disrupt Russian energy shipping. Thus far, Russian-linked vessels have been attacked in the Black Sea, the Mediterranean, and off the coasts of Africa. While Ukraine has both denied and admitted responsibility, it is unlikely that Ukraine is doing this without intelligence support from France, Britain, or the USA. Russia, for its part, has been responding, and has been increasing its own targeting of ships heading into Ukraine.
The fight for the Red Sea
Moreover, the fight for the Red Sea has significantly escalated. Israel recognised Somaliland, a province of Somalia (and formerly a part of British India which then entered into a union with the rest of Somalia). Israel’s aim is to gain military bases across the Arabian Sea from Yemen enabling it to more effectively target the Houthi and secure its own shipping. For its part, the UAE has been expanding its military presence in the hinterlands of the Red Sea, including in Sudan, Eritrea’s Assab, and Ethiopia. The UAE and Israel have had a strong security partnership, and the UAE refrained from condemning Israel’s recognition of Somaliland.
Is civilian shipping dead?
Critically, China has built a container ship that doubles as a military vessel. This is a different kind of stealth: the ship hides as a normal commercial vessel, rather than as a military vessel, making it harder to detect and track in heavily trafficked waterways, such as Malaga, the Suez, Panama, or Taiwan. Given China’s dominance in ship building, and the sheer number of Chinese built container ships carrying Chinese containers - which could be decoy launch systems - this is a game changer that blurs the line between civilian and military shipping. Critically, given China’s dominance in ship building, this permits China to roll out dual use vessels at an incredible rate, much faster than what can be done by the USA.
