(Ecofin Agency) - On Tuesday, March 11, Yemen’s Houthi rebels said they would start attacking Israeli ships in the Red Sea again. They vowed to continue until Gaza’s border crossings reopen and humanitarian aid is allowed in. This could cause more disruptions to maritime traffic.

Egypt is losing about $800 million in monthly revenue from the Suez Canal due to rising tensions, President Abdel-Fattah al-Sisi said on March 17 during an annual Ramadan iftar banquet hosted by the armed forces.

Since November 2023, Yemen's Houthi rebels have stepped up attacks on ships in the Red Sea, claiming solidarity with Gaza amid the conflict between Hamas and Israel. The situation has severely disrupted traffic through the canal, one of the world’s most vital trade routes. A ceasefire agreement in Gaza on January 19 briefly eased tensions, but on March 11, the Houthis announced they would resume targeting Israeli-linked vessels until Gaza’s border crossings are reopened and humanitarian aid is allowed through.

The ongoing instability has already pushed many shipping companies to reroute their vessels, avoiding the Suez Canal altogether. Instead, they are opting for the longer route around the Cape of Good Hope at Africa’s southern tip, particularly for oil shipments. This shift has deepened Egypt’s financial struggles.

Despite this rather bleak picture, President al-Sisi pointed to positive economic indicators. These include the International Monetary Fund’s recent approval of additional financial aid for the country. The funds, released under the Extended Fund Facility, are intended to help stabilize the economy and ease financial pressures, especially as falling Suez Canal revenues put further strain on state finances.

The Suez Canal typically handles about 12% of global maritime trade and is a crucial source of foreign currency for Egypt. A prolonged decline in revenue could worsen the country’s financial difficulties, putting at risk its goal of reaching $13 billion in canal earnings by 2025.