Surge in maritime violence boosts demand for private security forces

Missile attacks from the Houthis, Somali piracy, seizure by the Iranian Revolutionary Guards: ships have had more to navigate than just the seas this year — and owners are turning to professionals for help, Report informs via The Financial Times.

Companies offering specialist maritime security services say demand is rising as shipowners seek to keep crews, ships and cargoes safe from novel threats.

Shipowners have in particular been seeking advice on the risks of sailing through waters off Yemen, where Iranian-backed Houthis have been attacking vessels since Hamas’s attack on Israel in October triggered the war, companies say.

Attacks peaked in March when three mariners were killed after a missile hit the bulk carrier True Confidence. Ships and seafarers have faced further dangers from the Russia-Ukraine war and an upsurge in attacks by pirates from Somalia.

Security concerns were also heightened after the seizure on April 13 by Iran’s Revolutionary Guards of the MSC Aries, a container ship with Israeli links, as it transited the Strait of Hormuz at the entrance to the Gulf.

Jakob Larsen, head of safety and security for Bimco, a large international association of shipowners, said the search for security advice reflected how the shipping industry was “very worried” about the prospects of large-scale conflict in the Middle East.

“The deteriorating security situation in the Red Sea and the Gulf of Aden has . . . resulted in an increase in the use of armed guards onboard merchant ships in the area,” Larsen said.

David Johnson, chief executive of EOS Risk, a leading UK operator in the field, confirmed his company had been receiving more business as a result of the surge of insecurity.

The renewed interest marks a turnaround for a sector that had been declining over the past decade after a near-halting of attacks by Somali pirates. Attacks peaked between 2009 and 2012 before gradually diminishing, deterred by security guards and better onshore governance.

But Jon Gahagan, president of US-based maritime risk consultancy Sedna Global, said shipowners would need different means of protection against many of the current threats. Armed guards, for example, would not protect them against the ballistic missiles that Iranian-backed Houthis often fire at ships.

“The private maritime security companies are having to evolve from a one-dimensional, one-threat piece with piracy,” Gahagan said.

While the number of successful attacks has declined in recent weeks, the lull may reflect the withdrawal of the Iranian ship Behshad in early April from waters off Yemen. Analysts have noted attacks have been most intense when the vessel, which was widely suspected of providing targeting information to the Houthis, was in position in waters off Yemen. The vessel is currently off the coast of Iran, after spending three years in the Red Sea and Gulf of Aden.

It is unclear how long the Behshad will remain away from the area — and shipowners have said they will want clear assurances about safety before they return routinely to the area.

The seizure of the MSC Aries, meanwhile, has prompted fears Iran’s government might use the country’s position at the mouth of the Gulf to seize further ships related to hostile governments.

Peter Cook, a former head of the Security Association for the Maritime Industry (Sami), a trade association, said that, in the current, tense geopolitical environment, shipping companies had few alternatives to maritime security providers because navies were too overstretched to offer comprehensive protection. Sami had to dissolve itself in 2016 amid the industry’s then decline.

Johnson at EOS Risk, which grew largely by providing armed guards for ships at the height of Somalia’s piracy problem between 2009 and 2012, said providing “guys with guns” to shipowners had since become a “commoditised business”.

Instead, staff at the office — whose exact location the group prefers to withhold — use screens to monitor the locations of scores of clients’ ships and track potential risks facing them.

Owners would at one time have paid providers as much as $60,000 per transit through the piracy high-risk area off Somalia for a trained team of former elite military personnel. Before this year’s uptick in pirate activity, the rate had dropped as low as $2,000, with the personnel typically from lower-paid countries such as Nepal or Sri Lanka.

“We only provide that service to a very select clientele now,” Johnson said of the armed guards. Instead the focus was on advising clients about the risks their vessels and seafarers might face — and how to avoid them.

The Houthis have attacked ships with links to Israel, the US and UK. But one vessel — the Rubymar — was apparently hit on the basis of an outdated UK address in maritime databases. The group also struck the True Confidence saying it was an “American ship” even though it had been sold to a Greek company days before.

“The Houthis are looking at open-source information that might not be updated,” Martin Kelly, EOS Risk’s senior Middle East analyst, said. “There have been instances where the Houthis have attacked ships based on their historic ownership.”

Kelly said EOS might suggest that clients seeking to send ships close to Yemen reroute vessels whose current or past ownership presented higher risks via longer, lower-risk routes. Such a route might involve sailing between Asia and Europe via the Cape of Good Hope rather than the Suez Canal.

To guard against piracy, Kelly said clients sailing through high-risk areas were asked about issues such as the vessel’s planned speed and its freeboard — the height of the ship’s decks above the water. Pirates find it harder to board vessels moving faster with higher freeboards.

Gahagan said vessels with links to Israel, the US and UK would probably remain at risk in the area.

But, like others in the sector, Gahagan was sceptical that shipping companies would continue to pay for security advice once the current, immediate threats went away. The shipping industry had not yet come around to the idea that it would have to pay for sophisticated advice in the long term, he said.

Cook said he was confident maritime security companies would prosper. But he also expected the industry to be less lucrative than it was during the crisis that first created it.

“It doesn’t necessarily lend itself to the kind of gold rush we had with the earlier wave of Somali piracy,” he said.