Asian Nations Scramble as Red Sea Oil Blockade Worsens Energy Crisis

Asian nations are facing their second major energy crisis in six months due to another maritime chokepoint in the Middle East being blocked by the Houthis.

The blockade at the Bab al-Mandab strait, which forms the southern entrance to the Red Sea, has led to a significant drop in oil tankers transiting through the area and left only the Suez canal open for free movement of Gulf oil.

Countries like Japan, the Philippines, Thailand, and South Korea, which rely on Middle East oil for up to 90% of their imports, are scrambling to secure supplies. Ahmed Helal from the Asia Group says they're 'scraping at the bottom of the barrel' in terms of global reserve capacity.

The threat has caused a spike in fuel costs, leading some countries like South Korea to extend fuel tax cuts. Japan is already spending billions on fuel subsidies, hitting government budgets hard.

Some Japanese and South Korean refiners are seeking to circumvent the Houthi threat by rerouting cargos north through the Suez canal to the Mediterranean and around Africa, but this comes with huge costs, including doubling the voyage time for most Asian importers.