By Admin 
- As a result, crude oil prices may increase, India will also be affected.
Hormuz Strait Crisis Update: South Korea’s large shipping company Sinokor Merchant Marine has offered its crew members a bonus equal to six months’ salary. Provided that they have to complete a round trip through the Strait of Hormuz.
This offer from Sinocor is one of the largest ‘Danger Allowance’ ever in the shipping industry. This has been revealed in Bloomberg’s report. According to Sinocor’s proposal, if crew members complete a one-month round-trip from loading oil from Saudi Arabia or Iraq to unloading in the Gulf of Oman, they will be given 6 months’ extra salary.
Hormuz now in risk zone
This entire area remains very sensitive due to the military conflict between Iran and America and frequent missile attacks. In such a situation, ships will have to travel this sea route twice to travel from Saudi Arabia to the Gulf of Oman. Once while taking the empty ship and again while bringing it loaded. In view of this challenge, 6 months additional salary has been offered to the crew members.
Big jump in shipping costs
When the salary of the crew will be increased by 6 times and the war-risk premium of the ships will also increase, then the transportation cost per liter of oil will also increase manifold. Now when other companies will not be able to give huge bonuses like Sinocor, their crew members will refuse to go that route. This could lead to a huge shortage of crude oil globally. As a result, crude oil may reach or exceed $100.
Since India imports most of its crude oil from Iraq and Saudi Arabia. In such a situation, Sinocor increasing the danger allowance to such an extent shows how deep the energy crisis is. This fear became a major reason for the fall in the Indian stock market this week.
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