Maersk Announces Plans To Resume Navigation Through Red Sea Shipping Route

Leading Danish shipping corporation Maersk has signalled a change in the global maritime landscape by announcing plans to reopen shipping routes through the Red Sea and the Suez Canal. The move comes after big maritime firms, such as Maersk and Hapag-Lloyd, stopped using Red Sea routes because of security worries brought on by Houthi insurgent attacks in Yemen. Following Maersk’s announcement, the share price of the shipping company fell by 5%. Hapag-Lloyd, Frontline, and Hoegh Autoliners saw drops among the other equities.

The decision to resume operations in the Red Sea was made in response to the launch of a military campaign spearheaded by the United States to protect ships from Houthi attacks. The timing, however, is still flexible in light of changing backup preparations. Additionally, the number of vessels passing through the Suez Canal has increased, according to France’s CMA CGM.

Since December 19, Maersk has been travelling around Africa through the Cape of Good Hope, charging extra and taking longer to get there. For a conventional 20-foot container from China to Northern Europe, the corporation added a $700 fee, comprising a $500 peak season cost and a $200 transit disruption surcharge.

The peak season surcharge is scheduled for January 1, but the transit disruption charge immediately went into force. It’s yet unclear how these levies will be affected by the decision to resume Red Sea shipping. Maersk has declined to provide more comments and has refrained from sharing extensive details on its vessel timetables, citing that the situation is susceptible to change.

Hapag-Lloyd, meanwhile, will keep rerouting ships via the Cape of Good Hope because it deems the Suez Canal situation too dangerous. A representative of the German shipping company said that a review of the circumstances is planned for this Friday.

Reference: Reuters

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