Ship-refuelling companies along Africa’s coastline are experiencing a surge in business as more vessels divert around the Cape of Good Hope.
The shift is being driven by conflict in the Middle East, which has disrupted traditional shipping lanes and elevated Africa’s role as a key bunkering hub.
Shipping companies have been avoiding the Suez Canal and the Bab el-Mandeb Strait since late 2023, following Houthi attacks on vessels in the Red Sea.
More recently, U.S. and Israeli strikes on Iran and the closure of the Strait of Hormuz have reinforced the rerouting trend. Major shipping firms including Maersk, Hapag-Lloyd, and CMA CGM confirmed this month that they are sending vessels around the Cape route, according to Reuters.
Although these longer routes increase travel time, they create more opportunities for ships to refuel at emerging African supply points, encouraging fuel suppliers and trading firms to expand operations.
Existing suppliers such as Monjasa have reported rising demand, while companies including Vitol, Bunker Partner, Peninsula, Flex Commodities, and Global Fuel Supply have announced plans to grow their presence.
“Volumes have been positively impacted by the Red Sea security situation causing more vessels to reroute south of Africa,” said Monjasa spokesperson Thorstein Andreasen.
The company, which has operated in West Africa for nearly two decades and also supplies fuel at Fujairah, recorded further increases in activity during the first week of the Iran war. “No matter the outcome of the conflict, we expect overall volatility to remain high for a considerable period of time,” Andreasen added.
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The scale of the shift is becoming increasingly clear along the Cape route. The Cape Chamber of Commerce and Industry reported that vessel diversions had risen by 112% as of early March, indicating what many carriers now see as a long-term operational change.
“After nearly two years of operating under these conditions, it is increasingly hard to describe our setup as a temporary measure. It has instead become an adaptation to a new operational reality,” said Bhavan Vempati, head of Asia Market for Ocean at Maersk.
Maersk continues routine bunkering at ports in West Africa and Tangiers, he said, while the trend is also attracting new market entrants. In November, Flex Commodities began physical bunkering operations at Walvis Bay and Luderitz.
“We are targeting the growing volume of traffic moving around the Cape and the offshore market around the region, offering an alternative to traditional bunkering stops in the region,” said Flex managing partner Rakesh Sharma. He added that the company is initially focusing on West Africa, where supply still lags demand, particularly offshore.
In Ghana, bunker operator Misa Energy is increasing volumes to meet rising demand in offshore markets, according to operations manager Moses Komodatam, who expects bunkering volumes in the country to triple over the next decade.
Longer-term growth is also supported by expanding regional trade, investment in port infrastructure, and Africa’s strategic position on global shipping routes, said Tahra Sergeant of the International Bunker Industry Association.
At a conference in March last year, the Mauritius Ports Authority reported that bunker fuel sales at Port Louis nearly doubled to a record 929,043 metric tons in 2024, up from 509,837 tons the previous year.
However, challenges remain. Regulatory issues in South Africa, historically one of Africa’s largest bunkering hubs, have led to a loss of business to Port Louis and Walvis Bay.
According to a PwC report, bunker volumes in South Africa fell to about 80,000 tons per month in 2024, down from roughly 130,000 tons per month in 2023.
Industry experts warn that security concerns such as piracy, limited infrastructure, and uncertainty around fuel supply could constrain growth. The shutdown of the Strait of Hormuz has also reduced Middle Eastern fuel exports.
“Given the loss of crude supply and refinery run cuts, fuel oil supply is expected to tighten across all bunkering hubs,” said Emril Jamil of LSEG.
Infrastructure bottlenecks, including congestion at the Port of Tema, along with high product costs driven by tax policies, remain long-term concerns, Komodatam said. Tax and licensing disputes are also adding uncertainty.
In South Africa, Algoa Bay, a key refuelling point for global shipping, has seen reduced activity since a tax crackdown in late 2023.
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Image Credit: Reuters
