Egypt yesterday cranked up the tolls it charges for ships to transit the Suez Canal.
The new fees kicked in at midnight, and will involve tankers and petroleum product carriers paying an additional 5 per cent to traverse the 192-kilometre waterway, while other vessels such as container ships and roll on-roll off vessels will be charged an additional 2 per cent.
The Suez Canal Authority (SCA) last increased toll fees last year - by 3 per cent for all classes of vessels.
Yesterday's rise, however, has prompted a chorus of complaint from shipping bodies around the world, and some analysts are arguing the increase could actually result in vital foreign currency earnings from canal fees being reduced.
Tolls paid by ships using the canal bring in US$5 billion a year for the Egyptian economy, which has been in crisis since the 2011 Arab Spring. In raising the toll, the SCA is banking on shipping fuel costs ruling out alternative routes.
"The price hike is not that big to the point that would make people leave the Suez Canal," said the SCA's spokesman Tarek Hassanein, announcing the increase.
The canal, which links the Mediterranean Sea and the Gulf of Suez, is the quickest sea route between Asia and Europe, saving an average 15 days from a voyage. Even so, the number of container ships for example, using the canal fell 12 per cent to 6,332 last year, according to the SCA. A total of 17,225 ships of all types travelled the link last year.
A slowdown in trade on the major Asia to Europe route because of global economic turmoil has hit transits, while pirate activity in the region has had an impact. Unrest has also been rife in cities along the canal, particularly at its northern entrance in Port Said.
Although traffic through the waterway has so far not been directly affected, last month protesters blockaded local ferries crossing the canal and local supply boats were cast off to drift into the shipping lanes.
Until now the shipping industry, which is struggling with a five-year downturn in trade, has agreed that higher bunker fuel costs have deterred ship owners from re-routing. But some now say the calculation could reach a tipping point if the risk of delays from unrest increases.
A standard container ship bringing consumer goods on that route pays about $1 million in tolls for a return trip through the canal, representing about a quarter of costs for such a voyage.
"The effect of these increases will be to give a spur to those owners who may already be considering the Cape of Good Hope route as a serious alternative," said Peter Hinchliffe, the secretary general of the International Chamber of Shipping, an association that represents more than 80 per cent of the world's merchant fleet.
"Tensions are heightened, and the situation brewing in the Suez canal is only likely to exacerbate the situation further," said Andrew van den Born at the risk adviser and broker Willis.
The Danish oil and shipping group Maersk said it was concerned by the growing unrest. "Our operations in the container terminal in Port Said have suffered numerous delays, and this is increasing the costs of doing business," a company spokesman said.
Canal revenues fell to $405.1m in January, down 4 per cent on the previous month and almost 10 per cent lower than a year earlier, SCA data showed.
The route via the Cape is already becoming relatively less expensive as many ships resort to slow steaming in an effort to reduce fuel costs and to deliver reductions in carbon-dioxide emissions.