The Geopolitics of New Arctic Shipping Lanes

Welcome back to Foreign Policy’s SitRep. This week, we’re debating whether cricket can ever take off in the United States. (A reminder to D.C. residents that we’re slated to get our own professional cricket team soon.)

Alright, here’s what’s on tap for the day: The geopolitics of new shipping lanes in a warming Arctic, the forgotten war in Sudan takes a grim new turn, Iran boosts its uranium enrichment program, and more.

The Northern Route

OSLO, Norway—The hits to global shipping just keep coming.

With the Iran-backed Houthi rebels in Yemen still taking shots at commercial vessels in the Red Sea, traffic there is down almost 60 percent from a normal year. And even for those Western ships brave enough to make the trip, the cost of insurance for transiting the Bab el-Mandeb Strait has skyrocketed.

Norway, which has the world’s fifth-largest merchant fleet and largest mutual war risk insurance pool, has seen prices increase 100 times since the Houthi attacks began in October 2023, to about 1 percent of each ship’s value per transit through the Red Sea, said Audun Halvorsen, the director of the emergency department for the Norwegian Shipowners’ Association.

The high price of Middle East transit routes. The surging costs and fear of getting hit by Houthi drones and missiles have led some shippers to consider the Arctic as an alternative, as melting ice begins opening new potential on the so-called Northern Sea Route.

Stretching from the Barents Sea near Russia’s border with Norway all the way to the Bering Strait between Siberia and Alaska, the Northern Sea Route has been eyed by major naval powers as a possible shortcut for sea travel between Europe and Asia for centuries, but the region’s unforgiving frozen climate and extreme remoteness have made such ambitions infeasible.

But today, climate change is occurring four times faster in the Arctic than anywhere else on the planet, and massive levels of ice melt in the region from rising global temperatures have led to wild speculation about the route becoming commercially viable in the near future.

At first blush, going north looks promising. The route is about 8,000 miles between some parts of Europe and Asia, compared with about 13,000 miles for the Suez Canal route. The ability to slash some 5,000 miles off a ship’s journey would mean much faster travel times—a major plus in today’s world of online retail and next-day delivery.

But here in Norway, where the midnight sun will keep it light out all day and all night for the next three months of the year, officials and experts are skeptical that the route will be viable anytime soon.

“Short answer, viability close to zero,” Halvorsen said. “It’s not a realistic alternative in the foreseeable future.”

Treacherous waters. Why the pessimism? It’s a combination of great-power politics and treacherous terrain.

Russian authorities control most of the Northern Sea Route, Halvorsen said—about 70 percent of the Arctic—and ships wanting to use the route must secure the Russians’ permission and pay them transit fees. Given current relations between many Western countries and Russia amid the Ukraine war, that poses an obvious challenge.

The waters close to the shoreline that are safest for navigation are also very shallow, which means shippers would need to cut down their tonnage and use vessels smaller than container ships or go farther out to sea where the weather is much worse.

There’s very little ability to get search and rescue boats into the area. If a vessel like the Ever Given—the 1,300-foot-long container ship that ran aground and snagged traffic in the Suez Canal (and lit social media ablaze) for six days in 2021—got stranded here, there might be no way to get it out. Lucky crews might get helicoptered out. Unlucky crews could risk being polar bear food.

Shippers would also need vessels strong enough to withstand thick polar sea ice to get through, which would raise the price even more. And once the midnight sun goes down in August, the Arctic Circle will be engulfed in 24-hour darkness for the next six months.

Even with melting ice sheets now accounting for more than a quarter of sea level rise, experts said the ice conditions in the Arctic have been more challenging in the past decade, not less.

“Due to the distances, the weather, the darkness, [and the] floating ice, the predictability of moving along this route is so low that it’s not worth the reduced number of days compared to around either Suez or Africa,” Halvorsen added.

Not so limitless. China may be interested in trying to transit the Northern Sea Route anyway, experts said, to show off its growing great-power status. Doing that, however, could test the limits of China and Russia’s self-described “limitless” partnership.

Beijing has even put out its own Arctic strategy centered on extending its military capabilities into the region, developing infrastructure, and participating in governance efforts—some of which have been put on hold since Russia’s full-scale invasion of Ukraine two years ago. But China might be wary of going too far, especially since Russia still sees the region as its strategic backyard.

“If China pushes Russia too hard in the Arctic, I think the Russians would be very skeptical,” said Jo Inge Bekkevold, a senior China fellow at the Norwegian Institute for Defence Studies (IFS) and a former Norwegian diplomat. “The main strategic asset of Russia today is the Northern Fleet in the Arctic. And this is one area where I think they would like to keep China at a certain distance.”

The Center for Strategic and International Studies, a Washington-based think tank, reported last year that Russia has three major bases in the region, 13 airfields, and 10 radar stations. And the Northern Fleet’s submarine base at Gadzhiyevo is only about 125 miles from the Finnish border, which is now NATO turf.

“Russia’s attention for the High North has been standing strong,” said Katarzyna Zysk, a scholar at IFS. “The Northern Fleet is still capable of performing its core missions.”

Baby steps. For now, China is making careful, calculated, and limited moves to expand its influence in the Arctic—with an emphasis on limited. Experts said the only Chinese projects that have gained significant traction in the Arctic so far are gas drilling rigs on the Yamal Peninsula in Russia.

In 2022, not a single Chinese vessel transited the Northern Sea Route, said Henrik Stalhane Hiim, an associate professor at IFS tracking China’s activity in the region. China has a research station at Svalbard, Norway’s northernmost archipelago near the North Pole, but it has been mostly quiet for the past four years since the COVID-19 pandemic. And not a single Chinese navy vessel has ever crossed the Arctic Circle, Hiim said.

But even for China, the biggest issue comes back to economic viability. Most of China’s exports come out of the country’s southern provinces, such as Guangdong, which provide easier access to shipping lanes such as the Suez instead of northern routes. For China, “it’s not shorter to sail. It’s longer,” said Bekkevold of the Northern Sea Route. “Because if you sail from Shanghai through the Indian Ocean, through the Suez, then you end up in Trieste in Italy or Piraeus in Greece, that is shorter than sailing the Northern Sea Route.”

And in the world of shipping, which relies on predictability, one or two days of delay can lead to a big surge in costs.

For now, China has negotiated a hefty insurance discount for Red Sea transits to protect its ships even as the Houthis continue to target Western shippers. But chronic instability in the Middle East will only make Arctic sea lanes, however treacherous, more attractive to the emerging global superpower.

Let’s Get Personnel

Ramin Toloui, the U.S. assistant secretary of state for economic and business affairs, is leaving the State Department this summer for a post at Stanford University.

What We’re Listening to

Shameless plug alert, from Robbie. Foreign Policy is out with a new podcast, After Hotel Rwanda. It’s a project that Robbie and FP’s podcast team have been working on for over a year, involving a bizarre kidnapping plot, spies, Hollywood, and the painful legacy of genocide. Listeners can find the full four-part series here.

On the Button 

What should be high on your radar, if it isn’t already.

The forgotten war. The civil war in Sudan has significant geopolitical and humanitarian ramifications but has been all but forgotten in the midst of never-ending news about Ukraine and Gaza, as Robbie reports this week.

Some 20 million people in Sudan are at risk of famine, and the Rapid Support Forces (RSF) militia group, accused of widespread atrocities including genocide and ethnic cleansing, is encircling and poised to invade a city with some 2 million to 2.8 million civilians trapped inside. The war has devolved into a regional proxy conflict, and officials and experts working on the Sudan file fear it has all the makings of a coming genocide and failed state without the right level of international intervention.

Enriching and not the good kind. The United Nations’ top nuclear watchdog warned this week that Iran is increasing its stockpile of enriched uranium to near weapons-grade levels, as tensions roil between Tehran and Israel over the war in Gaza. As of May 11, Iran has 142.1 kilograms (313.2 pounds) of uranium enriched up to 60 percent, which is an increase of 20.6 kilograms (45.4 pounds) from the last report of the International Atomic Energy Agency (IAEA) in February, as The Associated Press reports. Enriching uranium is a complex process, but the long and short of it is that 60 percent is just a (relatively) short and simple step away from reaching weapons-grade levels at 90 percent.

What does it take, according to the IAEA, to theoretically make one atomic bomb? Around 42 kilograms (92.5 pounds) of highly enriched uranium. The Iranian government insists that its nuclear program is only for peaceful and research purposes, but no one believes that.

Adrift. The Biden administration’s grand plan to deliver aid to Gaza via a U.S. military ocean pier has backfired, to the surprise of almost no military expert who followed the plans in recent months. The pier took two months and $320 million to build and ultimately delivered less than 60 trucks’ worth of food before high tides damaged it and it had to be withdrawn for repairs.

Snapshot 

U.S. Army Spc. James Tomchak and other members of the 3rd U.S. Infantry Regiment place flags at the headstones of U.S. military personnel buried at Arlington National Cemetery ahead of Memorial Day, in Arlington, Virginia, on May 23.Kent Nishimura/Getty Images

Put On Your Radar

Friday, May 31: Philippine President Ferdinand “Bongbong” Marcos Jr. delivers the opening keynote speech at the International Institute for Strategic Studies’ annual Shangri-La Dialogue in Singapore. U.S. Defense Secretary Lloyd Austin is expected to meet Chinese Defense Minister Dong Jun for the first time on the sidelines of the conference.

U.S. President Joe Biden meets with Belgian Prime Minister Alexander De Croo at the White House.

Saturday, June 1: Iceland holds its presidential election.

Sunday, June 2: Mexico holds presidential and legislative elections.

Tuesday, June 4: The results of India’s general election are announced.

Quote of the Week

“We haven’t encouraged or enabled strikes outside of Ukraine. But Ukraine, as I’ve said before, has to make its own decisions about the best way to effectively defend itself.”

—U.S. Secretary of State Antony Blinken, laying out a careful nonanswer when asked about whether the United States would support Ukraine using U.S. weapons to strike targets on Russian soil.

This Week’s Most Read

• What Produced the China Miracle? by Howard W. French
• Consulting Firms Have Stumbled Into a Geopolitical Minefield by Henry Farrell and Abraham Newman
• Why Realists Oppose the War in Gaza by Stephen M. Walt

Whiskey Tango Foxtrot

Pettiness takes flight. North Korea sent balloons filled with trash and human waste floating over its border to land in South Korea, in response to Seoul’s cross-border propaganda efforts.

Stranger than fiction. Independent U.S. presidential contender Robert F. Kennedy Jr. may have made up a story about surviving a bow-and-arrow ambush and escaping it by throwing dynamite during a whitewater rafting trip in Peru, the Huffington Post reports.

Worse than the middle seat. Australian police have arrested a man accused of running naked through the aisles of a plane while it was mid-flight.