Red Sea Attacks Leave Tankers With Choice: Accept the Risks or Lose Money - The New York Times

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Some oil tanker traffic continues to go through the Suez Canal, while plentiful global reserves keep crude prices steady.

Attacks on commercial vessels in the Red Sea by the Houthi rebels in Yemen have left oil tanker operators facing an unwelcome calculation: accept the risks of steaming through the danger zone, or lose business.

The risks of conflict in the area may even be increasing, with a coalition of 12 nations led by the United States warning Wednesday that it would “hold malign actors accountable for unlawful seizures and attacks.”

Despite the attacks and the risk of more, some oil companies insist that the ships they charter take this route rather than an excursion around Africa, which could require an extra two weeks at higher costs. Tanker owners “can take it or leave it,” said Henry Curra, head of global research at Braemar, a ship brokering firm in London.

The oil markets have largely shrugged off the drone and missile attacks so far. Traders figure that there is enough petroleum on hand around the world to deal with any supply problems.

“Oil and gas inventories are relatively healthy in most big demand centers, so there’s a sense that disruptions and delays could be bridged,” said Henning Gloystein, a director for energy and climate change at Eurasia Group, a political risk firm. Also, as global economic growth has slowed, demand for oil has eased.

While some oil companies including BP say they are staying out of the area, others are continuing to use the Red Sea, which provides access to European markets through the Suez Canal.

world map of major shipping routes

Shipping route Major Other

Arctic Ocean

NETHERLANDS

UNITED

STATES

ISRAEL

CHINA

IRAN

Suez Canal

YEMEN

Red Sea

Atlantic

Ocean

Panama

Canal

Gulf of

Aden

Pacific

Ocean

Indian

Ocean

SINGAPORE

Cape of

Good Hope

Southern Ocean

Arctic Ocean

NETHERLANDS

ISRAEL

IRAN

Suez Canal

YEMEN

Red Sea

Atlantic

Ocean

Panama

Canal

Gulf of Aden

Indian

Ocean

Cape of

Good Hope

Southern Ocean

Source: C.I.A.

By Scott Reinhard

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Red Sea Attacks Leave Tankers With Choice: Accept the Risks or Lose Money - The New York Times
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