Red Sea Blockade Sparks Oil Price Surge, Threatens Global Energy Flows

The escalating conflict in the Middle East has thrown another curveball at the already fragile oil market, threatening to stall any recovery in energy flows.

With tensions rising after the Iran-backed Houthi militia declared a blockade on Saudi vessels seeking to pass through the Bab el-Mandeb Strait, global oil prices have surged above $90 a barrel, the highest in over a month.

The closure of the Strait of Hormuz and now the Bab el-Mandeb Strait has severely complicated global oil flows, forcing a rapid redrawing of trade routes. Vessels carrying Saudi crude to Asia are avoiding the strait altogether, instead crossing the Suez Canal into the Mediterranean and then circumnavigating Africa.

This logistical nightmare adds at least four weeks to a typical tanker journey, more than doubling normal sailing times while sharply increasing freight and insurance costs.