Israel's Transport Ministry on Tuesday said it was seeking to clarify Chinese shipper COSCO's reported decision to halt shipping to Israel.
Israeli media this week reported that COSCO had suspended shipping to Israel via the Red Sea over rising tensions in those waters.
“The Administration of Shipping and Ports is working with the relevant parties to clarify the Chinese shipping company's announcement to stop sailing to Israel,” the Transport Ministry said in response to a Reuters query.
Hong Kong-listed shares of Cosco were down 3% on Monday.
Cosco is China's largest shipping firm and holds almost 11% of the trade market share.
Orient Overseas Container Line (OOCL), which is a part of Cosco Shipping Group, has also suspended sailing to the Red Sea and stopped accepting Israel-bound cargo since December, citing operational issues.
“COSCO's decision is significant because it cooperates with Israeli shipping line ZIM, which will have to operate more ships on the Far East routes,” Globes reported.
Cosco has another line it jointly operates with Zim. In an e-mail to CNBC, Zim confirmed that it will continue its operations.
Oil and fuel tanker traffic in the Red Sea was stable in December, even though many container ships have rerouted due to attacks by Iran-aligned Houthi militants, a Reuters analysis of vessel tracking data showed.
The attacks have driven up shipping costs sharply along with insurance premiums, but have had less impact than feared on oil flows, with shippers continuing to use the key East-West passage. The Houthis, who have said they are targeting Israel-bound vessels, have largely attacked non-petroleum goods shipments.
The added costs have not made a big difference to most shippers so far because the Red Sea remains much more affordable than sending cargo around Africa.
But the situation bears watching with some oil companies like BP and Equinor diverting cargoes to the longer route. Also, increased shipping costs are likely to boost exports of US crude to some European buyers, experts said.
“We haven't really seen the interruption to tanker traffic that everyone was expecting,” said Michelle Wiese Bockmann, a shipping analyst at Lloyd's List.
