BEIRUT (Dispatches) -- The southern port of Eilat is set to shut down completely in the coming days, due to massive debts and paralysis caused by Yemen’s pro-Palestine naval blockade on Israel. 
The Israeli Ports and Shipping Authority said that Eilat Port will suspend all its operations starting on July 20. 
Hebrew media reports described the situation as a “dramatic step” that could undermine Israeli maritime logistics in the Red Sea, and referred to the port as “debt ridden.”
Specifically, the closure could halt logistical support for the Israeli navy, which has used the port’s facilities since the start of the war in Gaza.
The Eilat municipality has seized the port’s bank accounts after failure to pay tax debts estimated at around 700,000 NIS (over $200,000), according to Israeli outlet Globes.
“Following the shutdown of Eilat Port for ongoing operations and the economic situation it has found itself in as a result of the continuing crisis, the Eilat municipality has notified the port management of the seizure of all of the port’s bank accounts due to financial debts to the municipality,” Israel’s emergency authority said in a letter obtained by Globes. 
However, according to Israeli newspaper The Marker, the port’s debt stands at several million shekels. 
Activity at the port of Eilat has almost completely stopped since the start of the naval blockade imposed on Israel by the Yemeni Armed Forces (YAF) in November 2023. 
Half of the cars imported into Israel are usually unloaded at the port of Eilat, yet the cargo is now being diverted to other ports. 
Over 130 ships docked at the port in 2023, as opposed to only 16 ships the year after. Since the start of 2025 until mid-May, only six ships have docked at Eilat port. 
“Closing the port will stop the little activity that still continues there – limited phosphate exports and service to Navy ships,” The Marker notes, adding that “the port cannot operate at full capacity until sailings in the Red Sea resume with the removal of the Houthi threat.”
The Yemeni threat resulted in mass layoffs at Eilat port last year. 
The first four months of the Gaza war and around two months into the Yemeni naval blockade, revenues at Eilat port plummeted by 80 percent.
Yemen recently escalated maritime operations against Israeli interests. 
According to sources who spoke with Middle East Eye, “Israel has approached marine insurers about the status of war risk coverage for vessels with indirect ties to Israel” due to “concerns that back-to-back Houthi attacks in the Red Sea could hurt traffic at the port of Haifa.”
“There is a big discussion in the market right now whether insurers should cover vessels with even indirect connections to Israel,” one of the shipping sources said. “This is not good for Israel. The optics are damaging. The Israelis have spoken to insurers and shipping companies.”
Earlier this month, the Yemeni army sank two Greek-owned, Liberian-flagged vessels that were heading to or dealing with Israeli ports. 
On July 7, Israel carried out widespread attacks on Yemen. Tel Aviv said its latest attack on

 Yemen marked the start of a military operation against the country, dubbed Operation Black Flag. The YAF announced a large-scale missile and drone attack on several Israeli targets that day in response to heavy Israeli airstrikes.
According to Israeli reports, Tel Aviv is pressuring Washington to restart its bombing of Yemen and form a broad coalition to end the threat posed by the YAF. 
Israel’s Broadcasting Corporation (KAN) reported that Yemeni attacks on vessels headed to Israeli ports “can no longer remain solely an Israeli problem.”
Washington’s deadly campaign against Yemen came to an end in May after the U.S. burned through around $1 billion in munitions and failed to impact Sanaa’s military capabilities. 
The ceasefire deal did not include a halt to Yemeni drone and missile operations against Israel, which have continued regularly.