Maersk restarts Suez Canal routes amid global concerns

Posted on January 2, 2024   |  

Maersk is planning to restart routes through the Suez Canal and the Red Sea.

Previous disruptions in the Red Sea, with major companies like Maersk and Hapag-Lloyd pausing operations due to attacks by Yemen's Houthi militant group, prompted this decision.

Maersk's announcement resulted in a 5% drop in its share price, sparking concerns about a potential correction in freight rates.

Other shipping stocks, including Hapag-Lloyd, Frontline, and Hoegh Autoliners, also experienced declines of 6%, 5.3%, and 3%, respectively.

Market concerns center around the economic impact of reverting to shorter routes through the Suez Canal, potentially undoing recent gains.

Maersk's choice to resume Red Sea routes is tied to a US-led military operation safeguarding vessels from Houthi attacks.

Other companies, like CMA CGM, are also reassessing their shipping routes.