Egypt incurs $10B in Suez Canal losses over Gaza war, president says

Speaking during a meeting in Cairo with Mathias Cormann, Secretary-General of the Organisation for Economic Co-operation and Development (OECD), Sisi said continued attacks on ships in the Bab al-Mandab Strait, a key maritime chokepoint linking the Red Sea to the Gulf of Aden, had sharply reduced traffic heading to the Suez Canal, the presidency said in a statement.

Bab al-Mandab is one of the world’s most strategic shipping routes for energy and food supplies, alongside the Suez Canal and the Strait of Hormuz.

Attacks on shipping began in November 2023 when Yemen’s Houthi group launched drone and missile strikes targeting vessels in the Red Sea in a show of support for Palestinians facing Israeli attacks in Gaza, where more than 72,000 people have been killed in deadly Israeli strikes since October 2023.

These attacks have led to a sharp decline in the number of ships transiting the canal, one of Egypt’s main sources of foreign currency.

According to Osama Rabie, head of the Suez Canal Authority, canal revenues dropped by 66% in 2024 to $3.9 billion, down from about $10.2 billion in 2023.

On April 12, the Houthis warned they would escalate attacks in the Red Sea if Israeli and US attacks on Iran resumed.

Regional tensions have escalated after the US and Israel launched strikes against Iran on Feb. 28, triggering retaliation from Tehran against Israel, as well as US allies in the Gulf, along with the closure of the Strait of Hormuz.

A two-week ceasefire was announced on April 8 through Pakistani mediation, followed by direct talks in Islamabad on April 11, but no agreement was reached on a lasting truce.

US President Donald Trump later extended the ceasefire without setting a new deadline, following a request from Pakistan.