Red Sea transits: selectivity rules for liners as the arithmetic changes

17 August 2026

Since the Houthis began attacking ships in the Red Sea in October 2023, the Suez Canal has been the missing link for containerships sailing from Asia to Europe.

The arithmetic was straightforward: ships could either take the Suez route and expose themselves, their crews, and cargo to Houthi attacks, or sail thousands of additional miles around the Cape of Good Hope, which, for most became the rational choice – although opportunistic operators like Sea Legend Shipping stepped into the Red Sea vacuum.

But now the arithmetic is changing again.

In July, Maersk and Hapag-Lloyd began sending the Gemini AE11 India-Mediterranean service back through the Red Sea and Suez Canal, and also switched the AE19 Asia-Mediterranean service to the route.

Their latest resumption of Suez transits involves the AE2 Asia-North Europe service, with the 20,568 teu Manchester Maersk making a westbound Suez Canal transit yesterday.

CMA CGM has also been increasing its Suez exposure with services linking Asia with Europe. In May, it sent its new 24,000 teu CMA CGM Grand Palais, deployed on the Mediterranean Club Express service, through the canal.

Since 22 July,  the French liner has returned to Suez with its eastbound FAL3 Asia-North Europe voyages, three already completed with more sailings due to take the same route. However, westbound voyages are still using the longer Cape route.

China’s Cosco has announced that it will return to the Bab-el-Mandeb Strait after a two-year absence, reviving the mothballed RES4 service. The 4,738 teu Xin Hui Zhou calls at Sokhna on Wednesday, and a second voyage will add a Jeddah call, scheduled for 7 October.

Why would a liner operator send a multi-million-dollar asset into an area where commercial vessels remain under threat, risking the safety of crew and cargo? Because the Cape route is very expensive.

It consumes more fuel, requires more sailing time, ties up capacity, and complicates schedule planning. For a liner operator, the question is not simply whether the Red Sea is safe, it is whether the risk of using Suez is lower than the economic cost of avoiding it.

Container shipping consultancy Linerlytica said in its report this week that these moves aimed to overcome shortages of vessels and containers exacerbated by protracted port congestion across North Asia and Europe.

And with bunker prices rising amid renewed Middle East hostilities, sailing round the Cape is now even more expensive. At current VLSFO prices, it could mean fuel expenses of $4m to $5.5m for a 16,000 teu ship.

Insurance brokers are still pricing the Bab el-Mandeb as a war-risk zone. Late last month, Marsh put an additional premium for a vessel transiting the strait at about 0.5% of hull value, up from roughly 0.3% before the latest Houthi escalation.

That is expensive, but not necessarily prohibitive.

For a $100m vessel, 0.5% represents $500,000 for war-risk exposure. Against that has to be set the additional costs associated with a Cape routing. For a large containership carrying thousands of boxes, the economics can easily justify the insurance bill if the premium and operational risk can be passed to customers.

For container lines, today the sensible strategy is likely to be to maintain selective optionality.

A carrier does not need to announce the Red Sea as “open”. It can send certain services through Suez, monitor the threat, impose appropriate surcharges, and retain the ability to divert vessels at short notice.