The Suez Canal Authority has announced a 15% discount on transit fees for containerships with capacities of approximately 13,500 teu and above. This initiative aims to stimulate trade as the Red Sea shipping crisis shows signs of resolution. The offer comes in response to requests from containership owners and operators, considering recent developments in the security situation in the Red Sea and Bab al-Mandab Strait.
Suez Canal transit revenues have seen a decline over the past year as many vessels, particularly containerships, avoided the area due to attacks by Yemen's Houthis, who support Hamas in its conflict with Israel. U.S. President Donald Trump recently suggested that the crisis is nearing an end, stating that the Houthis agreed to cease attacks on shipping, with the U.S. halting strikes on the Iran-backed group. However, missile launches towards Israel continue, prompting military responses.
Despite these developments, major shipping lines remain cautious. Maersk CEO Vincent Clerc emphasized the irresponsibility of resuming Red Sea transits based on an uncertain ceasefire, citing regional volatility. Lars Jensen of Vespucci Maritime noted that the 15% discount is unlikely to influence decisions on Red Sea transits, which hinge on risk assessments.
Investment bank Jefferies highlighted the container shipping industry's vulnerability to market shifts if Red Sea transits normalize, estimating that diversions have tightened capacity by 11-12%, affecting ocean carrier pricing power. Analysts do not foresee a swift return to regular transits given the current risks.
Source: Splash