Egypt’s Suez Canal, a critical artery for global maritime trade, saw its revenues plummet by nearly 61% in 2024, with officials attributing the sharp drop to ongoing regional instability and attacks on commercial vessels in the Red Sea. According to a statement released by the Suez Canal Authority (SCA) on Wednesday, the canal generated $3.99 billion in revenue last year—down from a record $10.25 billion in 2023. The dramatic decline underscores the impact of escalating geopolitical tensions, particularly in the wake of the Israel-Hamas war and the Houthi rebel attacks in the Red Sea.
The canal, which connects the Mediterranean Sea to the Red Sea, has historically served as a strategic global trade route, with around 10% of world trade passing through it annually. However, in 2024, the number of vessels transiting the canal fell by approximately 50%, with only 13,213 ships recorded compared to more than 26,000 the previous year. The drop in traffic follows a series of targeted attacks by Yemen’s Iran-backed Houthi rebels, who began launching missiles and drone strikes at commercial ships in late 2023. These attacks, aimed at pressuring Israel to end its military campaign in Gaza, have created major security risks for vessels using the Red Sea and Suez Canal route.
Between November 2023 and January 2024, the Houthis reportedly targeted more than 100 merchant ships, sinking two and killing four sailors. Despite increased international naval patrols and security measures, the threat has continued, prompting many shipping companies to reroute vessels around the Cape of Good Hope—adding time and cost to global supply chains. Canal Authority Chairman Osama Rabie emphasized that Egypt continues to provide uninterrupted maritime and navigational services despite the regional challenges. However, he acknowledged that the crisis has had a “severe impact” on canal operations and revenue.
In March 2024, the International Monetary Fund reported a 50% year-on-year drop in Suez Canal trade volume for January and February, echoing concerns from international trade and logistics organizations about the long-term implications for global commerce. The Suez Canal underwent a major expansion in 2015 under President Abdel Fattah el-Sissi, including the construction of a second shipping lane designed to accommodate larger vessels and improve traffic flow. The canal has played a central role in Egypt’s economy as a key source of foreign currency, particularly critical amid the country’s broader economic struggles.
Opened in 1869, the Suez Canal remains one of the most strategically significant waterways in the world, especially for the transport of oil, liquefied natural gas, and containerized cargo. The recent disruptions have reignited global conversations about the vulnerability of vital maritime chokepoints during times of conflict.
