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OOCL Stops Serving Israel Because of "Operational Issues"

Israeli seaport
File image courtesy Port of Ashdod

Published Dec 17, 2023 6:18 PM by The Maritime Executive

Chinese container carrier OOCL has decided to suspend all shipments to and from Israeli seaports, the company announced Saturday. 

"Due to operational issues, OOCL will stop cargo acceptance to and from Israel with immediate effect until further notice," the firm said in a one-sentence statement on its website. 

At least four container lines have abandoned shipping through the Red Sea and the Suez Canal because of the ongoing threat of attack from Houthi forces in northern Yemen. MSC, CMA CGM, Maersk and Hapag-Lloyd have all signaled that they will take the Cape of Good Hope route, avoiding the risk of missile strikes, drone attacks or hijackings near Bab el-Mandeb. 

The Houthi movement has threatened to attack any ship carrying cargo to Israel, and the militant group has the full width of the Red Sea in range off Hodeidah. By stopping service to Israel, OOCL appears to satisfy the Houthis' political conditions for safe passage.

Unlike its Western peers, OOCL has not announced plans to cease navigation through this strategic waterway. If it continues to operate using the Suez Canal, it will benefit from a 1,900 nautical mile distance savings relative to competitors who choose the Cape route. Spot prices on this core east-west tradelane have begun to spike, bringing a potential revenue opportunity for an industry with an otherwise bleak financial outlook this year.

OOCL is owned by the Chinese state through COSCO Shipping, the world's largest shipowner by tonnage.