Drone Strike in Egypt Raises Concerns Over Energy Supply Security

A drone strike in Egyptian waters has raised concerns about the security of energy supplies through the Suez Canal and the Suez-Mediterranean pipeline (SUMED). The attack, which damaged two liquefied natural gas tankers on Wednesday, has heightened market worries about the safety of this strategic sea passage.

Iran has threatened to halt all energy exports from the region, saying no oil should be exported while the United States blocks Iranian tankers. Since the start of the war with Iran, Saudi Arabia has redirected most of its oil exports to the Red Sea, but threats and attacks by the Houthis have forced many tankers to stop using the route.

According to market analysis firm Kpler, increasing amounts of Saudi oil are heading north through the Red Sea to the Suez Canal. This shift is attributed to threats from the Houthis, which have led to a decrease in crude oil transported south through the Bab el-Mandeb Strait.