BP, the oil giant, has temporarily halted its tanker movements through the Red Sea due to increased attacks in the region, attributed to militants from Yemen. The company has cited growing concerns about the safety of its shipments amidst the escalating security situation.
The Houthis, a group with ties to Iran, have intensified their attacks on ships navigating the Red Sea, particularly near the Bab el-Mandeb Strait. This strait is a critical maritime passage, and recent attacks are believed to be aimed at disrupting vessels headed to Israel.
On Monday, BP emphasized the importance of safety and security, stating, “In our trading & shipping business, as in all BP businesses, the safety and security of our people and those working on our behalf is BP’s priority.” Consequently, they have decided to suspend all transits through the Red Sea temporarily, a decision they will continually review based on the evolving situation in the region.
Concurrently, Evergreen Line, one of the world’s largest shipping firms, announced that it would no longer transport Israeli cargo via the Red Sea. The company’s decision, aimed at protecting ships and crew, includes a directive to its container ships to avoid navigating the Red Sea for the time being.
The Houthis, who have declared their support for Hamas, are focusing their attacks on the Bab al-Mandab Strait, also known as the Gate of Tears. This narrow, 20-mile-wide channel is notoriously difficult to navigate and has become increasingly dangerous due to these attacks.
In response to the rising security threats, other shipping companies like Maersk had already stopped container shipments through this area. Following a close call involving its Maersk Gibraltar ship last Thursday, Danish firm Maersk also announced a suspension of its activities in the region.
The situation has impacted global oil and gas markets, with Brent crude oil prices seeing a 1% increase to $77.2 per barrel on Monday. Wholesale oil prices experienced a more significant surge, with European benchmark for gas, Dutch front month futures, rising over 7% to more than €35 per megawatt hour.
The Red Sea shipping route is vital for global trade, serving as a key conduit for the transport of oil, grain, and consumer goods from East Asia. The current disruptions pose a risk to this crucial trade artery.
