The Red Sea crisis poses a new threat to global trade and has already caused shipping costs to soar by 300%, the Spanish credit insurance company Credito y Caucion said, Report informs via TASS.

The company noted that the attacks on container ships in the Red Sea increased the cost of shipping by 300% and “exacerbated inflation risks.”

The increase is because commercial ships have to choose longer and more expensive routes to avoid conflict zones and sustain increased insurance costs, the Spanish company explained.

It added that most economists expect the situation to persist at least in the short term, but the longer the crisis continues, the more severe the consequences will be. Credito y Caucion noted that about 30% of all container traffic passes through the Red Sea, the most important channel for freight transport from the Asia-Pacific region to Europe.

The closure of the Red Sea route could reduce international shipping capacity by approximately 20%, the company said.