The country’s “supportive” relationship with Iran and the Muslim Brotherhood has caused six Middle Eastern countries to restrict airspace and ban trade and border crossing to and from Qatar.
Several Middle Eastern countries have severed diplomatic ties with Qatar this week, causing concerns over freight disruptions in the region.
Saudia Arabia, the United Arab Emirates (UAE), Bahrain, Egypt, Yemen and Libya have broken off ties with Qatar due to its continued support of Muslim Brotherhood and its relationship with Iran.
Because the move has caused airspace to be restricted in an around the country, the three major Gulf airlines, particularly Qatar Airways, will be affected, reported The Loadstar. The result is likely to be longer flight times and higher fuel costs for Qatar Airways.
One unnamed forwarder told The Loadstar the news was “pretty major for transshipment freight. We cannot use Emirates or Etihad for any business terminating at Doha, and we won’t be able to use Qatar for the other countries.”
Other major Middle Eastern airlines such as Emirates, Eithad, Gulf Airways and Air Arabia have posted statements concerning the news, saying all flights to and from Doha would be suspended from June 6. However, they noted, all other flights to the rest of the Middle East will operate as normal.
But the disruption is not limited to just air cargo and passenger service.
On the ocean side, Inchcape Shipping Services (ISS) says the Saudi Arabia Port Authorities have confirmed that no vessels will be allowed in or out of Qatar, regardless of vessel flag or owner nationality. Furthermore, vessels already in port and destined for Qatar will not receive port clearance.
The Ports and Maritime Affairs office at the Ministry of Transportation and Telecommunications for Bahrain has said all Bahrain Ports and territorial waters will remain suspended for marine navigation from and to the State of Qatar, also effective June 6.
However, ISS noted the Suez Canal Authority has advised that there are no restrictions on flying the Qatari flag through the Suez Canal is it is an international water passage.
Liquified natural gas (LNG) shipping will likely be hit the hardest, as Qatar is the largest producer of LNG. Bunkering bans at Fujairah have led analyst Court Smith of the international ship brokerage and advisory firm MJLF to say the bunkering ban “also stands to pinch the crude oil and product tanker market as Qatar exports about 490,000 barrels per day of crude oil. Qatar is also the site of new condensate production out of its Ras Laffan facility,” as reported by TradeWinds.
As of Tuesday morning, the Qatar Stock Exchange had plunged 10 percent on the news.
According to The Loadstar, Qatar is reliant on both the UAE and Saudi Arabia for its imports, as roughly half of its food is sourced in the Middle East, primarily from the UAE. The UAE accounts for some $2.76 billion of its imports, and is Qatar’s fifth biggest import country, said The Loadstar.
Middle Eastern countries break diplomatic ties with Qatar
