Brief: U.S. Energy Exports & Extended Red Sea Diversions

Mobius Intel Brief:

The U.S. initiated fresh strikes on sites controlled by the Yemeni Houthi rebels on Saturday in response to last week’s threats that the Iranian proxy group would resume attacks on Israeli-owned or operated vessels transiting the Red Sea.

Key Intel:

• Suez Canal Traffic: The Houthi’s protracted attacks on Red Sea commercial traffic have disrupted trade flows through the Red Sea and Suez Canal since late 2023. Satellite tracking data shows commercial vessel transits through the Suez Canal chokepoint sank to a new seasonal low of approximately 930 transits in February — 53% below pre-conflict levels in February 2023.

• Cape of Good Hope: Extended disruptions have rerouted East-West trade flows around the circuitous Cape of Good Hope path off the southern tip of Africa. Total commercial vessel transits around the Cape of Good Hope hit a seasonal high of nearly 2,500 transits in February — more than 2x pre-conflict levels in February 2023.

• Iranian Response: The U.S.’ strikes against Houthi-controlled sites are an indirect component of the Trump administration’s maximum pressure campaign against Iran. Tensions in the region will likely extend Red Sea disruptions until the resolution of the Israel-Hamas hostage exchange. While unlikely, an Iranian response to the U.S.’ activity in Yemen warrants monitoring as a near-term volatility catalyst.

• Suez v. Panama: Drought conditions that restricted Atlantic-Pacific voyages through the Panama Canal throughout 1H24 have eased, restoring an alternative route for U.S.-Asia trade. Satellite tracking data shows total commercial vessel transits through the Panama Canal increased 54% Y/Y in February after a 58% Y/Y increase in January. Monthly transits in early 2025 are approaching pre-drought seasonal averages from 2019-2022.

Looking Ahead

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