(COPENHAGEN, Denmark) — Maersk is diverting all containerships from Red Sea routes around Africa’s Cape of Good Hope for the foreseeable future, warning customers to prepare for significant disruption, Reuters reported Friday. Hapag Lloyd said it had tallied a big increase in costs by similarly diverting ships.
Shippers across the world are switching away from the Red Sea – and so the shortest route from Asia to Europe via the Suez Canal – after Iranian-backed Houthi militants in Yemen stepped up attacks on vessels in the Gulf region to show their support for Palestinian Islamist group Hamas fighting Israel in Gaza.
The trip around Africa can add about 10 days to journey times and requires more fuel and crew time, increasing shipping costs.
“The situation is constantly evolving and remains highly volatile, and all available intelligence at hand confirms that the security risk continues to be at a significantly elevated level,” Maersk said Friday. The company controls about one-sixth of global container trade.
The news will deepen concerns about a prolonged disruption to the delivery and supplies of goods from clothing to cars even after the United States on Dec. 19 launched a multinational operation to try to safeguard commerce in the Red Sea.
Hapag Lloyd incurred costs of at least $10 million between Dec. 18 and Dec. 31 after diverting 25 ships, a company representative told Reuters on Friday.