As Bloomberg reports, the US sanctions against Iran and Abu Dhabi’s competition are having a negative impact at DP World Plc’s ports in Dubai, who are seeing a less cargo volumes for a fifth year in a row.
Specifically, Drewry focuses on the fact that the Dubai’s container volumes have also been affected by the restrictions on cargo shipments to Qatar because of an embargo by the UAE and additional Arab nations.
Yet, the tensions in the Persian Gulf region, didn’t impact much DP World’s second-quarter throughput, said Neil Davidson, senior analyst for ports and terminals at London-based Drewry.
The Persian Gulf region is seeing increasing tensions the last months, keeping in mind the last incidents of the sabotage acts against tanker vessels in May and then June have gained the spotlight. In the meantime, the attacks in the Gulf of Oman affected UAE’s Fujairah oil hub, as shippers are trying to mitigate their time in the Middle East.
Also, DP World Group Chairman and CEO Sultan Ahmed Bin Sulayem commented
UAE and Australia volumes have been soft due to a loss of lower-margin cargo and challenging market conditions. However, we expect a more stable throughput performance in the UAE for the second half of the year.
Drewry’s Davidson added that the US sanctions implemented by the US President Donald Trump against Iran in November, worsen the situation and were a crucial factor behind the company’s decline. He continued that DP was affected by the competition with Khalifa port, because the latter joined an agreement with Hong Kong-based Cosco Shipping Ports and MSC Mediterranean Shipping Co. But, Khalifa port will handle more cargo in 2019, as Abu Dhabi Ports Chief Executive Officer Mohamed Al Shamsi said in December that Khalifa Port’s capacity will double in 2019.