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Along with the Strait of Hormuz, the Red Sea is another crucial maritime area where the Middle East conflict has spread due to the Houthi rebels in Yemen.
This puts strain on two of the most significant energy corridors in the world at the same time, raising the risk of the global supply chain and reducing the number of choices for rerouting.
The Houthis can obstruct shipping over the Bab el-Mandeb strait and jeopardise Saudi Arabia’s Red Sea export infrastructure, especially the Yanbu terminal, the terminus of the East-West pipeline that has worked around the Gulf.
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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.