The Houthi militia has reportedly halted attacks on Israel and shipping in the Red Sea, a development that could significantly affect global container shipping, according to Peter Sand, Chief Analyst at Xeneta. However, he cautions that a substantial return to the region will depend on further assurances regarding safety. “Carriers and insurance companies require more than just the word of the Houthi militia to ensure the safety of crews and cargo,” Sand stated.
While some carriers, like CMA CGM, have cautiously resumed voyages through the area, the overall number of container ships passing through the Suez Canal has declined in 2025. A perceived reduction in risk could lead to increased transits, but a full return to 2023 levels is unlikely.
Currently, the threat of Houthi attacks is forcing ships to take longer routes around the Cape of Good Hope, impacting around 2 million TEU of global capacity. A large-scale return to the Red Sea could flood the market, potentially causing freight rates to plummet unless carriers implement measures like idling or slow-steaming.
Sand warns that average spot rates for key trade routes have already dropped over 50% this year, and a return to the Red Sea could exacerbate this decline, disrupting global supply chains significantly.
Share it now
