Egypt controls one of global trade’s key chokepoints and that network of seaports begins with the Suez Canal. Now, that importance is being tested. Renewed conflict between the US-Iran and the frequent closure of the Strait of Hormuz, added further strain to an already-blustery Red Sea corridor. The implications have hit two ways: marine insurers have withdrawn from or repriced war-risk and political-risk insurance in the region, while freight forwarders have seen their ability to reach ports within the region restricted. For manufacturers and distributors, workarounds are no longer temporary disruptions that can be brushed aside; they need to be built into supply chains.
The global ocean freight industry is bearing the impact. Longer transit times, increased demurrage and higher tariff costs have forced many trading businesses to manage as events continue to unfold. Some organisations have opted to reroute around Africa via the Cape of Good Hope; forwarders who have recently returned to Suez strait, following the latest ceasefire, cite a time savings of 10 to 14 days compared with the Cape route, illustrating the cost of that redirection when faced the other way. The change is not feasible for all industries equally, however, time-sensitive goods or predefined delivery schedules have much less flexibility than raw or containerised products.
Egypt has had its own hedge against Red Sea exposure via the SUMED pipeline which allows crude oil flows to completely bypass canal transit from Ain Sokhna to the Mediterranean Sea (the hedge only applies to crude cargo, not rerouting containers). Containership exporters have generally shifted to more rail freight routes like China-Europe rail links. In both cases the underlying theme is multimodal flexibility: as 80–90% of all trade is shipped by sea, building resilience means having freight networks that can alternate between sea, rail and road freight without losing the cargo.
This is where the real work sits, not in temporary rerouting, but in rebuilding coverage architecture alongside it. The Joint War Committee’s high-risk designation for the southern Red Sea and Gulf of Oman has been repeatedly expanded since 2023 and each new incident resets that pricing baseline rather than letting it settle. Meanwhile, the Suez Canal Economic Zone and Ain Sokhna have continued attracting industrial and manufacturing investment, reinforcing Egypt’s strategic weight even as transit risk persists.
Insurers and reinsurers now need to treat transshipment-heavy routing as the norm, not the exception or an extra option, customising coverage for containership diversions, rail and road transit of crude and gas and the dry-port and digital-platform networks forwarders are building to compensate. Supply chain diversification is not a set of temporary options; it is a full model built between shippers, forwarders, insurers, and reinsurers. This war may prove to be the turning point that makes that multimodal permanent rather than reactive.
