Attacks on commercial ships in the Red Sea by Yemen’s Houthi rebels also scare major shipping companies and oil giants due to their economic and security impacts. Geopolitics rhymes with the economy more than ever. 12% of world traffic passes through the Red Sea area, 23 thousand ships per year, almost 30% of regular services, 20% of the energy that travels by sea, oil, gas and refined products. Effectively diverting global trade from a crucial artery is costly. It costs shipowners, but ultimately, and above all, consumers.
European oil and natural gas prices have risen, in part, due to market jitters over attacks by the Iranian-backed Houthis. These are attacks on container ships and oil tankers crossing the narrow waterway separating Yemen. of East Africa and leads north to the Red Sea and the Suez Canal. In addition to Europe’s critical energy supplies, food products such as palm oil and wheat and most of the world’s manufactured goods move via container ships, many of them passing through the Suez Canal. Almost all the products needed by stores for Christmas will have already been delivered, but online orders could be delayed, analysts say, because four of the world’s five largest container shipping companies have suspended or redirected movements in recent days.
Meanwhile, shipping companies have a double choice: face the risk of traveling through the Red Sea and accept the higher insurance costs that this entails, or divert their ships to other routes. Both options will result in higher tariffs and delays in the delivery of goods, the costs of which will vary throughout the supply chain. Economists say there is a risk of strong headwinds for the global economy, which is still recovering from the Covid-19 pandemic, Russia’s invasion of Ukraine and the significant monetary tightening seen in many countries. With central bankers around the world poised to declare victory in the fight against inflation, a surge in oil and gas, coupled with global supply chain disruption, could threaten to reverse these successes.
Source: IL Tempo

John Cameron is a journalist at The Nation View specializing in world news and current events, particularly in international politics and diplomacy. With expertise in international relations, he covers a range of topics including conflicts, politics and economic trends.