NEW YORK (Agencies): In a recent interview with CNBC, Daan Struyven, Goldman Sachs’ head of oil research, cautioned that global crude oil prices could potentially double if disruptions caused by Yemen’s Houthi rebels extend to impact the crucial Strait of Hormuz. Houthi rebels have effectively blockaded shipments through the Red Sea, targeting vessels associated with Israel in solidarity with the Palestinian cause.
Struyven highlighted that a one-month disruption in the Strait of Hormuz could lead to a 20% increase in oil prices, with the possibility of prices doubling if the interference persists. While he deemed this scenario “highly unlikely,” numerous analysts in the energy sector have expressed concerns about the situation in recent weeks.
The ongoing attacks by Houthi militants have compelled global shipping companies to reroute vessels around the Cape of Good Hope, adding approximately 6,000 nautical miles to the journey. This detour can result in delays of up to a month and substantial increases in shipping costs for cargos traveling from Asia to Europe or North America.
The Houthi strikes, ongoing for several weeks, pose a significant threat to the flow of commercial goods through the Red Sea and the Suez Canal—a crucial trade artery between Asia and Western countries. The militants have launched missiles around two dozen times since December 19 in response to the Israel-Hamas conflict, further escalating tensions in the region.