A reported ceasefire in the war between Israel and Hamas has raised speculation about when global container shipping lines could resume regular operations through the Red Sea.
The route is a critical link to the Suez Canal for ships sailing between Asia and the Mediterranean, Europe and North America.
In a wave of attacks that reshaped the global supply chain, Yemen-based Houthi rebels since late 2023 have terrorized merchant vessels they claim are linked to Israel, with drones, missiles and watercraft.
The attacks have killed two; two vessels and their crews remain captive in Yemen and Iran.
American and European military forces since 2024 have deployed naval escorts to protect merchant ships in the region. Even so, most major ocean carriers have chosen to divert container and tanker services away from the Red Sea and on longer, more expensive voyages around the Horn of Africa. One exception is French carrier CMA CGM, which has mostly maintained its Middle East rotations.
The diversions have added as much as two weeks’ sailing time to typical services, taken capacity out of the market and compounded delays and port congestion while releasing tons of additional polluting emissions from oceangoing ships.
Carriers saw median delays of 4-6 days in November, said analyst project44, down from a peak of 13 days in February 2024.
Tolls from the Suez Canal dropped 60% in 2024 — a major concern for Egypt as the waterway accounts for about 15% of the country’s annual revenue. Container vessel volumes declined by 75% from 2023, according to project44.
But higher freight rates on longer voyages produced an unexpected windfall for liner operators, who saw their profits skyrocket by tens of billions of dollars in 2024.
That’s one reason why it’s likely ocean carriers won’t rush to return to the Red Sea until they — and their insurers — are convinced it’s safe to go back in the water.
In an unpredictable region, it’s not clear whether the anti-Israel, Muslim fundamentalist Houthis will even abide by the ceasefire. The Yemeni Armed Forces in public statements urged continued fighting until the “siege” of Gaza is ended.
In recent months, the militia has aimed its attacks directly at Israel, with a few token assaults on what were most likely military transports escorted by U.S. naval vessels in the Red Sea.
The change in strategy came soon after a series of events upended geopolitics in the Middle East.
Israel succeeded in killing the leadership of Hamas in Gaza and the ruling Hezbollah in Lebanon, severely blunting their combined momentum. Later, the sudden collapse of the Assad regime in Syria forced Russia to abandon its naval installations in that country.
Russia had been accused of providing the Houthis with targeting data on Red Sea shipping.
The Houthis’ main sponsor, Iran, saw its domestic situation deteriorate after attacks by Israel severely damaged two natural gas pipelines. Tehran has since rationed electricity, and many civilians have intermittent power and heat.
An Iranian university professor working in the U.S. who requested anonymity because she still has family in Iran told FreightWays that life there has become a day-to-day struggle for food and medical services, and that children only occasionally go to school.
A recent published report claimed that China had stepped in to arm the Houthis in exchange for safe passage of its ships.
In the end, for liner operators the time simply may not be right for a return to the Red Sea.
With reconfigured alliances and vessel-sharing agreements set to launch in February and new tonnage scheduled to deploy, vessel operators will need time to work out the inevitable complications.
Depending on the stability of events, it could be summer or later before carriers redirect back to the Red Sea route.
This article was updated Jan. 15 with comments from project44.
Find more articles by Stuart Chirls here.
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