Amid a lack of signs of easing the tensions in the Red Sea and the Suez Canal, disruptions to global shipping in the area could last into next year, the chief executive officer of container shipping giant A.P. Moller-Maersk A/S told the Financial Times this week.
“We can see that the situation in the Red Sea is not going to be shortlived, but will last at least into the second half of the year,” Maersk’s CEO Vincent Clerc told FT.
“We are not very optimistic we will be going through Suez any time soon.”
Since December 2023, global shipping traffic has been upended by intensified attacks from the Iran-aligned Houthis in Yemen on commercial vessels transiting the Red Sea before and after entering or exiting the Suez Canal.
The Houthi attacks on commercial shipping in the Red Sea have forced many tanker and container ship operators to reroute voyages via Africa, which has increased travel times, delayed goods delivery, disrupted supply chains, and raised shipping costs.
The disruption to traffic via the Red Sea/Suez Canal route could continue for months and ultimately result in sustained higher freight costs and a shortage of container ships, which are now bound on longer routes via the Cape of Good Horn, analysts say.
Maersk warns on its website that “While we continue to hope for a sustainable resolution in the near future, the situation in the area is constantly evolving and remains highly volatile. All available intelligence at hand confirms that the security risk continues to be at a significantly elevated level, and therefore has a potential impact on your logistics operations.”
On Thursday, Denmark-based Maersk reported first-quarter earnings in line with its expectations and said that the combination of higher demand and a prolonged Red Sea crisis is “expected to continue well into the second half of the year.”
By Tsvetana Paraskova for Oilprice.com
