Suez Canal: Navigating the Red Sea Crisis Impact

Since February, 47 ships have been rerouted from Cape of Good Hope to the Suez Canal due to disruptions caused by Houthi attacks in the Red Sea. The crisis, starting November 2023, raised shipping costs and could cost Egypt approximately $7 billion in lost Suez Canal revenue in 2024.

The chairman of Egypt's Suez Canal Authority, Osama Rabei, announced that 47 ships have been redirected from the Cape of Good Hope to the Suez Canal since February began. This shift is a response to ongoing disruptions in the Red Sea caused by Houthi militant activities.

Rabei noted that the crisis in the Red Sea hasn't created a sustainable alternative to the crucial shipping route that the Suez Canal offers. He also mentioned optimistic signs of regained stability in the region amid the ongoing challenges. The security threats led vessels to avoid the Suez Canal, opting instead for a longer route around Africa, which increased shipping costs.

In December, Egyptian President Abdel Fattah al-Sisi highlighted that the disruptions could cost the nation a significant $7 billion in reduced revenue from the Suez Canal in 2024. The economic implications underscore the strategic importance of maintaining stability and safety in the region.

(With inputs from agencies.)