Why did Red Sea attacks raise shipping costs in 2024?

Ships took the long route around Africa

Shipping routes that move prices

More than 80% of world trade by volume travels by sea, and much of it squeezes through a few narrow passages. Block one, and prices jump far away.
Key choke points: the Strait of Hormuz (about a fifth of the world's oil), the Suez and Panama canals, and the Strait of Malacca between Indonesia, Malaysia and Singapore, one of the busiest sea lanes on Earth.
In March 2021 one giant container ship, the Ever Given, got stuck in the Suez Canal for six days, holding up an estimated US$9.6 billion of trade every day.
Since late 2023, attacks on ships in the Red Sea pushed many carriers to sail around Africa instead, adding 10 days or more to trips between Asia and Europe. Freight costs multiplied.
Blocked or riskier route → longer trips, more fuel, higher insurance → higher shipping costs → importers and shoppers pay more.
Common mistake
Mistake: thinking a blockage only affects nearby countries. One stuck ship or one risky strait can move oil, grain and container prices worldwide.
Key takeaway
A handful of narrow sea lanes carry the world's goods. Trouble there means higher costs everywhere.

About how much of the world's oil passes through Hormuz? About a fifthAround one in five barrels used worldwide passes between Iran and Oman.
Which canal did the Ever Given block in 2021? SuezThe giant ship wedged itself across the Suez Canal for six days.
If a key route is blocked, prices usually... RiseLonger trips and delays raise costs, and goods get scarcer where they're needed.
Why did Red Sea attacks raise shipping costs in 2024? Ships took the long route around AfricaDetours add days of fuel, crew and insurance costs to every trip.