Due to the escalating threats posed by Houthi attacks in the Red Sea, numerous freight vessels and tankers have been compelled to change their routes and navigate towards the southernmost point of Africa. This strategic decision aims to safeguard these ships from becoming potential targets, ensuring the safety of both cargo and crew members on board.

Telegram Writer

Since November, the Houthi rebel group in Yemen has been carrying out attacks on ships in the Bab al-Mandab strait, a narrow passage that separates northeast Africa from Yemen. They claim to be targeting vessels with connections to Israel in response to the conflict in the Gaza Strip.

Their tactics have included armed seizures, missiles, and drones, creating a dangerous situation for sailors. For instance, a tanker might be carrying as much as one million barrels of highly flammable oil. The crew of the MV Genco Picardy, which was transporting phosphate rock, escaped unharmed and successfully extinguished a fire caused by an incendiary drone.

In light of the continuous attacks taking place in the Red Sea, maritime vessels are now choosing to circumvent the Suez Canal and instead take the longer route around South Africa’s Cape of Good Hope. This decision has been prompted by the escalating security concerns and heightened risk posed by the attacks.

The global shipping industry has found itself facing significant challenges due to these disruptions on this crucial shipping route, leading to prolonged journeys around the southern tip of Africa for ships and subsequently escalating trip costs. Ships are now compelled to extend their voyages by an additional 15 days, exacerbating financial burdens for businesses involved in international trade.

Although the Cape of Good Hope route entails an additional distance of approximately 4,000 miles around the African continent, it is widely regarded as a more secure and reliable alternative by numerous corporations.

A bunkering services operator based in Cape Town, who preferred to remain anonymous, told Moneyweb in December that he had noticed a significant increase in demand for bunkering services in recent weeks from ships that have been redirected from the Suez Canal.

There has also been a rise in requests for bunkering in Mauritius, but the country is said to be facing challenges with capacity and supplies.

The suspension of offshore bunkering services at Algoa Bay by the South African Revenue Service in 2023 due to non-compliance with customs and labour laws has decreased the ability to support ships navigating around the Cape.

This suspension has resulted in an increase in bunkering activity, specifically refuelling, in Cape Town. Alex Miya, the harbour master of the Port of Cape Town, has officially acknowledged these developments.

The Western Cape Province is now benefiting from the redirection of shipping routes, which has brought economic advantages.

The Premier of the Western Cape, Alan Winde, emphasized the importance of efficient operations and seizing unexpected economic opportunities that arise when ships pass through the region.

The Houthi attacks on ships persist despite recent extensive military operations conducted against them by the United States and the United Kingdom.

Bloomberg reported that Port Louis in Mauritius and ports in Namibia are becoming more popular for refuelling ships avoiding the Red Sea.

“Offshore bunkering is becoming more commonplace around the world as it is more cost and time-efficient for shipping companies,” said Durand Naidoo, chair of the Institute of the Chartered Shipbrokers of SA.

“We need to set up more bunkering services to meet the demand that we are likely to experience in the coming months. Fortunately, these services are delivered by bunker barges or ships, so it could be set up in weeks.”

As the ongoing crisis in the Red Sea continues, the diversion of ships through the Cape of Good Hope remains in effect, presenting South Africa and the continent with a distinctive economic prospect.

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