LONDON, April 2: Major shipping lines serving the northern Gulf region have raised war risk fees by 2,200 per cent since war broke out in Iraq but the effect on international trade has been minimal, an industry body said on Wednesday.

Costs have trickled down to the bottom line after leading insurers raised the cost of war cover for vessels last week.

“Prices have most certainly gone up to Kuwait and destinations to Iran, but increases for the bulk of the Gulf’s trade has been very small — I was really quite surprised,” said Keith Nuttall, a spokesman for the Europe Middle East Rate Agreement (EMERA) liner conference.

EMERA, which covers eastbound container trade between northern Europe and the Gulf for nine shipping lines, raised fees this week from a flat rate of $8 per lorry-sized container to $180.

Calls to Bahrain rose to $60 and Iran to $55. But Dubai, Doha and Abu Dhabi rose marginally to $20-$30 per 20-foot container.

During the build-up to conflict in Afghanistan in 2001, EMERA’s surcharge climbed to $125 per container.

The surcharge on break-bulk cargo, from wheat to rice and other perishable goods, has risen in a similar way, industry sources said, but figures were not immediately available.

EMERA justified the increases on the grounds that hostilities have begun and are ongoing.

“The increases are at least understandable to Kuwait where there’s clearly military action but otherwise they’re negligible,” Nuttall said.

He said the impact on international trade would be small because, critical hub ports like Dubai, which handles most of the region’s trade in goods had escaped the steep rises.

Some 95 per cent of the world’s goods and products are shipped by sea.

Three other liner conferences serving Gulf ports from Asia, the Mediterranean, and Europe have also raised charges in the last few days.

The Mediterranean Arabia Conference, representing five leading lines, raised costs in line with EMERA’s; the Jeddah Service Group, representing seven lines operating between northern Europe and Saudi Arabia, raised prices this week from the flat rate of $16 per container to $30.

And the India Pakistan Bangladesh Ceylon Conference, comprising 14 major lines, is charging an additional war risk premium of between $15 and $25 for journeys between the United Arab Emirates India, Pakistan and Sri Lanka.

Last week a Port Authority of Thailand official said war risk fees on container freight moving between Thailand and the Middle East had risen between $30-$60 per container.—Reuters