Hormuz Rerouting Doubles Cape Traffic Without Delivering a Windfall

Over the past seven months, shipping traffic through the Strait of Hormuz has dwindled to a trickle, with Iran effectively closing the critical maritime chokepoint ever since the U.S. and Israel launched attacks against it. Consequently, major global shipping companies rerouted their vessels via South Africa's Cape of Good Hope, with traffic around the southern tip of Africa having doubled since the war erupted in February. Unfortunately, the projected Southern African economic windfall in the form of surging demand for bunkering fuel, port calls and maritime services has largely failed to materialize. Indeed, there has been no significant increase in vessel arrivals at main ports like Durban or Cape Town, with the vast majority of diverted cargo ships and tankers simply transiting South African waters rather than stopping for bunkering, repairs or cargo handling thanks to a mixture of logistical and economic challenges.