Key facts
- Attacks on ships, ports, and export terminals in the Black Sea are disrupting global grain and oil supplies.
- Ukraine's grain exports have been reduced by approximately one-third due to the conflict.
- Shipping freight costs for Ukrainian ports have doubled.
- Ukraine's agricultural sector anticipates losses of $1.5 billion to $3 billion in export revenue this year.
- Ukraine has requested UN assistance for safe passage through the Black Sea.
- Russia denies targeting civilian infrastructure, stating it only strikes military-related targets.
Escalating conflict in the Black Sea region has led to a significant disruption of global grain and oil trade flows, with both Russia and Ukraine intensifying attacks on each other's commercial vessels and export facilities. Ukraine announced on July 23 that maritime transport to and from its three unoccupied Black Sea ports was effectively frozen due to these attacks.
In July alone, Russian missile and drone attacks targeted 57 Ukrainian and foreign-flagged merchant ships. One such incident involved the Turkish-owned bulk cargo carrier Golden Leo, which was struck by three Russian missiles off the coast of Odesa on July 19, resulting in 10 fatalities. The vessel sank on July 27.
These attacks have severely impacted Ukraine's export capabilities, cutting its grain exports by approximately one-third and doubling shipping freight costs into and out of the country. The Black Sea maritime corridors are crucial for Ukraine, handling about 90% of its agricultural exports, which constitute three-quarters of its foreign-currency earnings. The Ukrainian agricultural sector is facing potential direct losses in export revenue ranging from $1.5 billion to $3 billion this year.
Ukraine has urged the United Nations to assist in facilitating safe transit through the Black Sea, accusing Russia of war crimes and economic terror by holding global food security hostage. This situation is reminiscent of the 2022-2023 period when a Russian naval blockade trapped millions of tons of Ukrainian grain, causing global food market instability.
However, the current crisis differs from the previous one, which involved a direct naval blockade. The current situation sees intensified attacks on civilian vessels and port infrastructure. Russian shipping group FESCO has suspended new shipment orders via the Black Sea following an attack on one of its vessels. While Ukraine is seeking alternative export routes, officials estimate these will not reach full capacity until the end of August and will only handle about half the normal volume. Shipping activity in the Sea of Azov has also been restricted since July 10.