Spot bunker demand at the Suez Canal could strengthen in 2026 as the prospect of improved security conditions in the Red Sea prompts major shipowners to weigh a return to the route.
The Yemen-based Houthis signalled a pause to their maritime attacks in the Red Sea on 11 November, following a peace agreement signed between Israel and Palestinian militant group Hamas a month earlier. But they warned attacks would resume if fighting in Gaza restarts.
Since then, the Suez Canal Authority (SCA) has said the route is ready to receive container ships and has held talks with major carriers including Maersk and CMA CGM. The SCA has also introduced flexible pricing, including a 15pc discount for container ships over 130,000t. Some large container vessels have already transited, such as the 396m CMA CGM Jules Verne with a gross tonnage of 176,000t.
A sustained return of large shipowners would lift bunker demand at Suez, reversing the shift to southern Africa ports seen since late 2023 when the Houthi attacks began. Smaller shipowners could follow, but they would need insurers to cut premiums, which remain high because of the attacks.
After the SCA announcement, Danish firm Maersk said it is considering a return to the canal and aims to normalise transits over time, but without setting a date. The decision depends on the Israel-Hamas ceasefire holding and the wider geopolitical situation.
Shipping firms have increasingly switched to the longer Cape of Good Hope route since the attacks started, adding weeks to east-west voyages. In the third quarter of 2025, 3,277 vessels passed through the Suez Canal, down from 6,253 in the same period of 2022, SCA data show.
The longer route has lifted bunker fuel consumption and operational expenses for shipowners. Some bunker fuel suppliers have shifted to Egypt's Port Said and paused Suez operations, but one told Argus they are already planning a return and arranging replenishments.
Some market participants remain cautious, noting this is not the first time the Houthis have announced a pause in attacks.
Suez transit tonnage in early May this year was about 70pc below the 2023 average, according to UN Trade and Development's 2025 Review of Maritime Transport. The rerouting boosted spot demand at Cape Town and Durban on South Africa and Port Louis in Mauritius. Spot demand at Cape ports could fall if ships return to Suez, potentially easing bunker prices in southern Africa, market participants said.
Argus assessed delivered very-low sulphur fuel oil (VLSFO) in Cape Town at an average of $612.25/t between 8 January and 8 December 2025, while Durban averaged $598.75/t. By comparison, Port Said averaged $550.75/t and Suez $635/t over the same period, the latter reflecting higher operational costs and limited supplier activity.
