Israel's Eilat port to shut down over unpaid debts, Houthi blockade

Israel’s Eilat port will halt operations from Sunday after failing to pay its debts, following a steep drop in revenue caused by Yemen’s Houthi blockade in the Red Sea.

Eilat municipality had frozen the port's bank accounts of about 10 million shekels ($3 million) in unpaid taxes. It had accumulated as revenues collapsed amid Houthi attacks on ships linked to Israel.

With shipping diverted to the Mediterranean ports of Ashdod and Haifa, Eilat's 2024 income plunged to just 42 million shekels ($12.5m), down nearly 80 percent from 212 million shekels ($63m) in 2023, according to Israeli Channel 12.

"Following the shutdown of Eilat Port from regular operations and the financial crisis it has entered due to the ongoing conflict, the Eilat Municipality informed the port’s management of the seizure of all its bank accounts due to debts owed to the municipality," Israel's Ports and Shipping Authority said.

"As a result, a notice was received from the Shipping and Ports Authority indicating that Eilat Port is expected to shut down and cease all activity starting this coming Sunday."

The Port of Eilat, Israel's southernmost port on the Red Sea, has long served as a key gateway for trade routes crossing Egypt’s Suez Canal. The trade hub also hosts the Eilat-Ashkelon pipeline that transports crude oil to the Mediterranean.

However, since November 2023, Yemen's Houthis have intensified missile and drone strikes in support of Palestinians and to protest Israel’s Gaza genocide.

Israel has killed at least 58,573 people and wounded 139,607 Palestinians, most of them women and children, with thousands still missing and widespread famine reported.

On Wednesday, the Houthis claimed responsibility for a dual drone attack that they said struck the Eilat port and a military site in the Negev region, describing the attack as a "successful simultaneous operation".

Israel has yet to issue an official statement on the reported closure.