Egypt stands to suffer some of the greatest losses from the escalating tensions in Bab Al-Mandab and the Red Sea, amid serious concerns that disruption to shipping through the Suez Canal could result in heavy economic, security and strategic costs.

The Houthis’influence in Yemen, coupled with their intensifying attacks on Saudi territory and facilities and their control of strategic sites and islands at the entrance to the Red Sea, poses a serious threat to Egyptian influence and raises the prospect of a new Hormuz scenario for the region and the world.

Cairo is facing a new regional reality that threatens not only international shipping and Suez Canal revenues, but also its regional standing, placing a poisoned dagger at its eastern and southern flanks.

Bab Al-Mandab, whose name means “Gate of Sorrows”, could bring further troubles to Cairo after becoming a hotspot for piracy, tensions and conflict. It could deal a severe blow to the Egyptian economy and perhaps trigger social unrest at home if the Houthis succeed in turning it into a second Hormuz.

Bab Al-Mandab, the southern gateway to the Red Sea, is a key link in the shortest maritime route connecting Asia and Europe, and East and West, via the Suez Canal in north-eastern Egypt. The canal connects the Red and Mediterranean Seas and serves as a vital artery for global trade routes. The strait is also one of the main maritime passages linking the Red Sea with the Gulf of Aden and the Indian Ocean.

Around seven million barrels of oil pass through the strategic strait every day, equivalent to around 7 per cent of global production, along with around 8 per cent of liquefied natural gas shipments, between 12 and 15 per cent of global trade, and 30 per cent of container trade. Goods worth more than $1 trillion are also transported through it annually, according to Bloomberg.

The current situation points towards a “double chokehold” scenario involving both the Strait of Hormuz and Bab Al-Mandab. This would transform the crisis from one affecting oil and maritime transport into a crisis for the global economy, spreading the shock from the Gulf to Egypt, Europe and the rest of the world.

Economists who spoke to Middle East Monitor stressed that the continued rise in oil prices above $100 per barrel would severely harm Egypt’s already troubled economy, which is under heavy debt pressure exceeding $164 billion, according to data from the Central Bank of Egypt.

Economists who spoke to Middle East Monitor stressed that the continued rise in oil prices above $100 per barrel would severely harm........

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