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Markets fear Saudi-led military action in Yemen will choke oil delivery to Europe and US

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Markets fear Saudi-led military action in Yemen will choke oil delivery to Europe and US

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Kuwait has moved to reassure markets that its oil tankers are negotiating safely through the Bab el-Mandab Strait, the narrow 40 km strip of water between Yemen and Djibouti, one of the seven choke points in the delivery of oil to Europe and the US.

The current Saudi-led military action against the Houthi rebels in Yemen has spooked markets and sparked fears of a increase in insurance rates for shipping sailing in the area.

The US Energy Information Administration estimates that in 2013, 3.8 million barrels of crude moved through Bab el-Mandab per day.

That makes the strait the world’s fourth largest choke point for oil after the Strait of Hormuz, between the United Arab Emirates and Iran; the Strait of Malacca, between Malaysia and Indonesia; and the Suez Canal in Egypt between the Red Sea and the Mediterranean.

The area is well guarded to protect the movement of oil following regular attempts to hijack tankers by Somali pirates.

The British navy along with vessels from France, the US, Russia, Ukraine and India conduct regular patrols to ensure the safe passage of the black gold.