Toll revenue at the Suez Canal has dropped by 60% this year(2024)  – a loss of U$7bn for the Egyptian economy – amid attacks on shipping in the Red Sea and ongoing regional tensions, FreightWaves wrote.

The drop in revenue was due to rising geopolitical challenges, Egyptian President Abdel Fattah al-Sisi was quoted as saying in the 29 December report.

A key route for maritime commerce, Egypt collects tolls on vessels that transit the canal.In 2023, revenue from the tolls totalled US$9.4bn, or 15% of the foreign currency entering the country, the report said.Meanwhile, a dredging project to test two-way vessel transit had been a success, the Suez Canal Authority was quoted as saying in a statement on 28 December Currently only some sections of the canal allow two-way transits via a parallel waterway opened in 2015.

Two-way traffic could increase the waterway’s vessel capacity and avoid lengthy shutdowns such as the 2021 grounding of the container ship Ever Given which blocked canal traffic for six days, FreightWaves wrote.

Since late 2023, Houthi fighters based in Yemen have disrupted global trade by attacking merchant and naval vessels in the Red Sea, just south of the canal.Most major container ship operators have diverted ships away from the region and on longer, more costly voyages around the Horn of Africa, for services connecting Asia with the USA, the Mediterranean and the Middle East, the report said.The diversions have pushed up shipping rates and boosted carriers’ profits by billions of dollars, according to the report.

A multinational force of US and European military had been patrolling the area, providing escorts for merchant vessels, FreightWaves wrote.

The Iran-backed Houthis have said the missile and drone assaults were in solidarity with Palestinians in the Israel-Hamas war.At the time of the report, there had been a reduction in attacks as Iran dealt with its own internal issues, while the Houthis had increasingly targeted Israel itself, the report said.The fall of the Assad regime in Syria and withdrawal of Russia from ports there have added to the uncertainty in the Middle East, according to the report.

Source : Oil & fats international