Yemen Houthi group, in a series of attacks on commercial ships at the southern end of the Red Sea, has prompted shipping companies to reroute vessels, avoiding the Suez Canal in Egypt. The attacks, aimed at supporting Palestinians amid conflict with Israel and Hamas, have led to increased costs, time, and heightened oil prices and war risk insurance premiums.
Significance of the Suez Canal:
– The Suez Canal, spanning 192 km, is a vital sea route connecting Asia and Europe, serving as one of the quickest passages.
– Critical to global oil trade, about 9.2 million barrels per day pass through the canal, representing 9% of global demand.
– It accommodates over 60% of the world fleet of tankers, over 90% of bulk carriers, container carriers, car carriers, and general cargo ships.
– Revenue from tolls is crucial for the Egyptian economy, reaching a record $9.4 billion in the year to June 30.
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– Since Nov. 19, 55 ships have rerouted via the Cape of Good Hope, while 2,128 passed through the canal, according to the Suez Canal Authority.
– Major freight firms, including MSC, announced temporary diversions, and oil major BP temporarily paused transits through the Red Sea on Dec. 18.
Historical Context:
– The first canal was constructed under Pharaoh Senausret III (1887-1849 BCE), linking the Mediterranean and Red Seas via the Nile.
In 1869, the Suez Canal was finished, creating the shortest nautical route between Europe and the Indian and western Pacific oceans.
The 1956 canal nationalization by Egypt sparked the Suez Crisis between Britain, France, and Israel. After 1973 Yom Kippur, the canal reopened.
The disruption caused by Houthi attacks underscores the geopolitical and economic significance of the Suez Canal, impacting global trade routes and adding complexities to maritime navigation.
Our Reader’s Queries
Who are the Houthis in Yemen?
The Houthis, a sizable clan hailing from Yemen’s northwestern Saada province, are known for their extremist views and adherence to Zaydism, a branch of Shiite Islam. Yemen was once governed by a Zaydi imamate for a millennium, until it was toppled in 1962.
What is the Houthi issue in Yemen?
The Houthis have set their sights on ruling over all of Yemen and have shown support for external movements that oppose the United States, Israel, and Saudi Arabia. Due to their ideological beliefs, the ongoing conflict in Yemen is often viewed as a battleground for the Iran-Saudi Arabia proxy war.
Who finances Houthis?
The Treasury has announced that it is taking action against a network that facilitates the transfer of Iranian funds to the Houthis. The network is linked to Said al-Jamal, an Iran-based financier who has been under U.S. sanctions since June 2021. The measures are aimed at disrupting the flow of funds to the Houthis, who have been involved in ongoing conflict in Yemen.
How much of Yemen do the Houthis control?
The Houthi insurgents have taken over the capital city of Sanaa and the former North Yemen, except for the eastern Marib Governorate. They have been in conflict with the pro-government forces of the Republic of Yemen.