Ongoing conflict in Gaza and the West Bank is deterring container shipping lines from returning to the Suez Canal route, with safety concerns and falling spot rates weighing heavily, reported UK's Seatrade Maritime News.

Israeli strikes on Gaza and violence in the West Bank have raised fears the Houthi forces could rescind their ceasefire. A letter from Houthi Major General Yusuf Hassan al-Madani warned hostilities could resume, including bans on Israeli navigation in the Red and Arabian Seas.

Analysts say carriers and insurers remain unconvinced the Red Sea route is safe. Xeneta chief analyst Peter Sand noted some CMA CGM vessels tested the waters in November, but overall transits through Suez have declined in 2025.

Alphaliner reported CMA CGM carried nearly 1.5 million TEU via Suez this year, with Maersk at 1.1 million TEU, though Maersk avoids the southern Red Sea. MSC and Hapag-Lloyd recorded 900,000 TEU and 150,000 TEU respectively.

CMA CGM's Med5 service continues to transit Suez, supported by alliance partners Evergreen, Cosco and OOCL, with French Navy protection near Yemen. Analysts say a wider return would require major service pattern changes.

Xeneta estimates the Cape of Good Hope route now absorbs 2 million TEU. Spot rates from Asia to Europe, the Mediterranean and US East Coast have plunged 50 per cent this year, with projections of a further 25 per cent fall in 2026.

Mr Sand warned a large-scale return to the Red Sea would flood the market with capacity, pushing carriers deeper into loss-making territory.