British-registered cargo vessel, Rubymar, sinking after being damaged in a missile attack by the Houthis in the Red Sea off the coast of Yemen. EPA
British-registered cargo vessel, Rubymar, sinking after being damaged in a missile attack by the Houthis in the Red Sea off the coast of Yemen. EPA
British-registered cargo vessel, Rubymar, sinking after being damaged in a missile attack by the Houthis in the Red Sea off the coast of Yemen. EPA
British-registered cargo vessel, Rubymar, sinking after being damaged in a missile attack by the Houthis in the Red Sea off the coast of Yemen. EPA

Stranded ship hit by Houthis has 22,000 tonnes of dangerous fertiliser on board


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A cargo ship damaged by a Houthi strike this month is out of action and anchored in the Red Sea, with tens of thousands of tonnes of fertiliser on board, the owner of the ship's operating company said on Monday.

The MV Rubymar – a Belize-flagged, UK-owned and Lebanese-operated bulk carrier – remains mostly afloat, but the engine room and one of the holds have become submerged, said Roy Khoury, head of the Athens-based Blue Fleet Group that runs the ship.

The strike by the Yemeni rebels caused a small fuel leak that will be repaired by a work ship, Mr Khoury said.

Satellite images of the stricken vessel show a fuel spill stretching about 30km from the ship, which was struck by two Houthi missiles on February 18.

The 24-member crew – from Syria, Egypt, India and the Philippines – has been evacuated through Djibouti.

Authorities at the Djibouti port warned of the dangers of the fertiliser on board the ship.

The Djibouti Ports and Free Zones Authority said the vessel was carrying 22,000 tonnes of fertiliser and was abandoned in the Bab Al Mandeb.

The Blue Fleet Group also has an office in Beirut, which was hit by an explosion in August 2020 after 2,750 tonnes of ammonium nitrate ignited.

The Rubymar was heading for Bulgaria when it was struck by the Houthis, who have been attacking commercial vessels in the Red Sea since November, in a campaign the group says is aimed at disrupting global trade to put pressure on Israel to withdraw from the Gaza Strip.

Plans for the ship to be towed to Djibouti or the Yemeni city of Aden were foiled when both ports refused to allow the ship to dock.

“We are contracting a tug boat to come alongside and tow the vessel to a safe port,” Mr Khoury told The National.

“The problem is that neither Djibouti nor Aden port authorities are accepting the vessel. No idea why Aden is refusing the ship. Same applies to Djibouti.”

It will cost about $1 million to tow the vessel to Jeddah, he said.

He did not confirm whether the Saudi port agreed to receive the partially flooded ship.

Alan Coleman, owner of Aalmar Surveys Group, which specialises in maritime services, including ship inspections, said the vessel's fate could depend on its insurance and the risk appetite of salvagers.

“It depends if the vessel has P&I [protection and indemnity insurance] and is worth the risk-reward of salvage to any salvage company,” Mr Coleman said.

“If not insured, I would say that it will stay where it is and pollute and possibly sink in that location if in international water. If in flag-state territorial waters, it is then up to that country how it wants to deal with it.”

Protection and indemnity insurance covers outlying risks to vessels and their cargo. Those risks include acts of war.

Ian Ralby, a non-resident senior fellow at the Centre for Maritime Strategy, also emphasised the challenges of salvage in a conflict zone.

“The salvage of this sort of vessel, in optimal conditions, would pose a challenge, but not an overwhelming challenge,” he said.

“These, however, are not optimal conditions. The Houthi threat is significant, not only because of the possibility of a potential second attack on the Rubymar but the challenge of the salvage operation itself being a sitting duck.”

The fate of the ship, Mr Ralby said, highlighted how serious Houthi attacks in the region could become.

“As much attention as the spill is now getting, it is worth pointing out that this is just the fuel tank of the vessel. Imagine what would happen if a tanker spilled its cargo,” Mr Ralby said. He is also CEO of IR Consilium, one of the first organisations to assess the stranded FSO Safer, an oil tanker stranded and corroding off the Yemen coast, after Houthi militias seized it.

“This is why my team and I worked for years to address the FSO Safer – a 1.14 million barrel spill stands in stark contrast to the current spill of a few thousand barrels at most. The impact on the coastal states would be horrific, especially with regard to the desalination plants on which millions rely for their drinking water.”

How dangerous is the cargo on the MV Rubymar?

A statement from US Central Command, the American military headquarters in the Middle East, condemned the Houthis’ “unprovoked and reckless attack” and warned tens of thousands of tonnes of fertiliser could “spill into the Red Sea and worsen this environmental disaster”.

“The cargo of ammonium nitrate poses additional challenges, as combustion is a concern – just think back to the Beirut blast on 4 August 2020 to see how bad that can be. But finally, there is the Red Sea itself – a turbulent, saline body of water, which makes containing an oil spill challenging,” Mr Ralby said, referring to the 30km oil slick.

Sammy Kayed, an environmental expert who has worked with the UN, said a spill involving such a large amount of fertiliser could have disastrous ecological consequences in the Red Sea.

The area is home to a delicate aquatic ecosystem with coral reefs as far south as the Bab Al Mandeb.

Mr Kayed told The National that 22,000 tonnes was "pretty significant". "It can be considered a large spill that has the potential to lead to significant environmental damage," he said.

“Essentially, a fertiliser spill would cause a rapid nutrient increase, which means it gives a lot of food or nutrition for algae to bloom rapidly and this will disrupt the balance of marine ecosystems.

“And then you'd have oxygen depletion, where the algae breaks down and consumes a lot of oxygen and leads to very low dissolved oxygen levels, which leads to dead zones where aquatic life can't survive.”

At their peak in 2017, “dead zones”, caused by surges in algae linked to fertiliser pollution in river outflows, covered more than 20,000 square kilometres in the Gulf of Mexico, US government environment agencies said.

Fertiliser pollution was estimated to be more than a million tonnes a year in the Gulf of Mexico, but 22,000 tonnes could still be damaging in the confines of the Red Sea, Mr Kayed warned.

“If the current takes the spill towards the coast where the corals are, the algae brooms would block and deprive coral reefs of sunlight and that would cause serious damage to coral reefs,” he said.

“If there is a lot of ammonium in the water it can also be toxic to marine organisms. It will damage gills, cause respiratory stress or failure, and neurological effects. All this puts stress on a very biodiverse part of the world. Southern Red Sea coral reefs are some of the most pristine and undisturbed in the world.”

The US is leading an international naval coalition formed to retaliate against Houthi strikes on ships in the Red Sea.

Despite the formation of the coalition and several rounds of joint US-UK air strikes against Houthi targets in Yemen, the Iran-backed group has continued its campaign against vessels in the region.

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A worker is categorised as skilled by the MOHRE based on nine levels given in the International Standard Classification of Occupations (ISCO) issued by the International Labour Organisation. 

A skilled worker would be someone at a professional level (levels 1 – 5) which includes managers, professionals, technicians and associate professionals, clerical support workers, and service and sales workers.

The worker must also have an attested educational certificate higher than secondary or an equivalent certification, and earn a monthly salary of at least Dh4,000. 

Uefa Nations League: How it works

The Uefa Nations League, introduced last year, has reached its final stage, to be played over five days in northern Portugal. The format of its closing tournament is compact, spread over two semi-finals, with the first, Portugal versus Switzerland in Porto on Wednesday evening, and the second, England against the Netherlands, in Guimaraes, on Thursday.

The winners of each semi will then meet at Porto’s Dragao stadium on Sunday, with the losing semi-finalists contesting a third-place play-off in Guimaraes earlier that day.

Qualifying for the final stage was via League A of the inaugural Nations League, in which the top 12 European countries according to Uefa's co-efficient seeding system were divided into four groups, the teams playing each other twice between September and November. Portugal, who finished above Italy and Poland, successfully bid to host the finals.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Updated: February 28, 2024, 8:46 AM