Following Rubymar sank after the Houthi strike, an old sense of gloomy anxiety resurfaces again in the maritime world. Does everything unfold like a snowball as same as for Suez Canal closure in 1967?
On June 6, 1967, during the Six-Day War, Egypt closed the Suez Canal until June 5, 1975, as Israel occupied the Sinai Peninsula, including the east side of the Canal.
The maritime world still vividly remembers that the Suez Canal became the frontline between Israeli and Egyptian forces, resulting in the canal's closure for the longest period.
Suez was the main actor behind the Oil Crisis in the 70s
In 1966, the Suez Canal played a crucial role, handling 60% of Italy's, 39% of France's, and 25% of Britain's total oil consumption. The canal reopened in 1975 after being closed due to the Yom Kippur War in 1973 when Egypt sought to regain the Sinai.
During the conflict, OAPEC nations reduced oil production and imposed an embargo on oil exports to the United States because Richard Nixon requested $2.2 billion to support Israel in the war.
However, the embargo only lasted until January 1974. Despite that, the price of oil remained high even after the embargo was lifted.
Concern grows in the Pentagon
Today, many analyses consider that the Houthi crisis will have worse results in a disaster scenario.
The latest article published by CNN points out the Biden administration's concern over the Houthis never considering giving up attacks.
According to the article, the Biden administration is struggling to halt the ongoing attacks by the Iran-backed Houthis against ships in the Red Sea. The group continues to fortify its weapons stockpile inside Yemen, even though the US has carried out significant strikes on them in recent weeks.
It is obvious that Houthis significantly take advantage of Yemen’s geography for their logistics. The region extending the southernwest tip of the Arabian peninsula can be a perfect place thanks to the mountains and hills that form Western Yemen (The region has a frontline towards the Red Sea) to conduct an asymmetric war against any bigger power.
Nobody forgets Afghanistan, where two superpowers, the Soviet Union and the United States, were unable to conduct a long-term war against Islamist guerrillas in a mountainous region. Even with today's highly developed war technologies, this fact remains valid for both sides, as they have enhanced their methods.
The weakness of globalism
Houthis had been only watching merchant vessels while passing in front of their hometown until the Hamas and Israel war began. During the conflict, they rapidly came to realize that even if, a stone is thrown from a Houthi Village will drop in the mall where Western people want to go shopping.
Here is the weakness of globalism.
“God created war so that Americans would learn geography,” said Mark Twain.
Consequently, Americans well learned the villages where Houthis were born are next to the most critical seaway in the world.
“We know that the Houthis maintain a large arsenal,” the Pentagon said, hours after the Houthis hit yet another cargo vessel in the Gulf of Aden with ballistic missiles. “They are very capable, they have sophisticated weapons, and that’s because they continue to get them from Iran.”
There is a new question emerging regarding the transportation conducted by Iran to regions like Palestine, and Yemen despite the strict blockage over the Gaza Strip and the border with Yemen.
What is the role of maritime transportation in Iran’s weapon logistics?
This subject must not be ignored but this should be another topic we will deeply take it later.
South African shipping agencies did not answer our questions
Freight charges are already rising, impacting businesses in import-dependent countries, including Europe.
It is reported that freight charges for containers have increased fivefold compared to before the crisis in many regions. Despite this, there might be some winners. For instance, South African shipping agencies are expected to experience a boost nowadays. However, they remain silent in response to our questions. We had sent inquiries to the leading shipping agencies in South Africa, but none of them answered.
We decided to deliver our questions to one of the most popular maritime analysts, Sal Mercogliano, who owns a YouTube Channel named 'What Is Going On With Shipping’.
He says “The Red Sea is forcing more ships - tankers and gas carriers - into the longer diversion. The losers are shippers who will be paying more and waiting longer. The winners are the container ocean carriers as they will have higher rates.”
“The global supply chain, while robust, is susceptible to shocks against the system and when they hit a vital component it can have a much disproportionate influence,” says Mercogliano when we inquire about how he foresees the future of the global supply chain
China's role
Reuters has already claimed that China recently attempted to nudge Iran into reining in Houthi attacks against civilian ships in the Red Sea. However, it is said that China’s efforts were focused exclusively on extracting guarantees to protect China’s direct interests.
Mercogliano considers that China has been developing redundant supply routes through its Belt and Road Initiative. He mentions that while one route may shut down, they have secondary and tertiary routes available.
The unholy trinity: Politics – Money – Maritime
It is known that the only thing everybody wants to know is the future. However, even five families who are assumed to have been ruling the world for centuries do not know what we will see. It is easy to say that the coming US election will change roles. Nevertheless, the results may be further far from what the Liberal world expects.
Comprehending the trinity, so politics – money – maritime, means breaking down why politicians make certain moves, understanding the financial impacts, acknowledging that the maritime industry is the only sector that seems the frontline of geopolitics, and making steps with this knowledge.
