Africa Ship Refuelling Surges as Red Sea Crisis Reroutes Shipping

A significant shift is underway in global shipping, with African bunkering hubs experiencing a surge in demand as vessels reroute to avoid escalating tensions in the Middle East. The disruption to key trade routes is reshaping maritime logistics and bolstering the continent’s role in supplying fuel to international shipping lines.

The primary catalyst for this change is the ongoing instability in the Red Sea and surrounding areas. Since late 2023, attacks by Houthi forces have prompted many shipping companies to divert vessels away from the Suez Canal and the Bab el-Mandeb Strait. More recently, escalating conflict involving U.S. And Israeli strikes within Iran, coupled with concerns about potential disruption to the Strait of Hormuz, have further reinforced this trend.

Denmark’s Maersk, a global shipping giant, announced on Friday it would temporarily reroute some vessels around the Cape of Good Hope, citing “unforeseen constraints” in the Red Sea, as reported by Reuters. Other major carriers, including Hapag-Lloyd and CMA CGM, have followed suit, opting for the longer southern route around Africa.

While the extended journey adds to transit times, it has simultaneously created a significant increase in demand for bunkering – the supply of fuel to ships – along the African coastline. This has spurred investment from established bunkering companies and attracted new players to the market. Suppliers like Monjasa are reporting rising volumes, while companies including Vitol, Peninsula, and Flex Commodities are expanding their operations to capitalize on the growing demand.

The impact is already visible in shipping traffic patterns. The Cape Chamber of Commerce and Industry reported a more than 100% increase in vessel diversions by early March, suggesting a potentially lasting change in shipping routes. Kenya’s Lamu Port, previously underutilized, is too experiencing a notable uptick in activity, as Business Insider reported.

This increased traffic is driving investment in port infrastructure and bunkering facilities across the continent. Flex Commodities recently launched bunkering operations in Namibia, strategically positioned to serve vessels rounding the Cape of Good Hope and operating in offshore markets. In West Africa, suppliers are scaling up capacity to meet anticipated growth in demand, with some projecting substantial volume increases over the next decade.

Several ports are already benefiting from the shift. Mauritius’ Port Louis nearly doubled its bunker fuel sales in 2024, while Namibia’s Walvis Bay and Luderitz are gaining prominence as key refuelling stops. However, South Africa has experienced a decline in market share, attributed to regulatory challenges and declining volumes in recent months.

Despite the positive outlook, industry stakeholders acknowledge ongoing challenges. These include risks associated with piracy, potential infrastructure bottlenecks, and concerns about tightening fuel supply due to reduced exports from the Middle East. High taxes and regulatory uncertainty in certain African markets continue to pose obstacles to expansion.