Mark Gagnon

The Suez Canal, the Strait of Malacca, the Panama Canal, and the Bab el Mandeb, the BEM, the BEM Strait, at the entrance to the Red Sea, all of these narrow passages through which enormous volumes of global trade must flow.

And in 2021, the world got a reminder of this vulnerability,

when the container ship Ever Given ran aground in the Suez Canal.

And it blocked one of the world's busiest trade routes for six days, and it caused an estimated $9.6 billion per day in disrupted trade.

You remember when that boat got stuck.

Think about that.

That's basically $10 billion a day for six days.

$60 billion in that one week.

This isn't happening in a vacuum.

In 2024 and 2025, Houthi militants in Yemen were attacking commercial ships at the Bab el-Mandeb, the narrow passage on basically the other side, the southern end of the Red Sea that connects to the Suez Canal.

And those attacks forced major shipping companies to reroute around Africa, which added weeks and years.

You know, just more time and more money in cost.

And of course, it gets passed on to the consumer.

The insurance industry was already on edge from the Red Sea crisis when the Hormuz situation escalated, basically meaning that the global shipping system was dealing with two major chokepoint crises simultaneously for the first time ever.

You have this...

Insurance issue coupled with a military issue that makes everyone unstable.

And when things are unstable, markets are unstable.

And of course, oil production and the whole energy system is going to be unstable and you pay for it.

But Hormuz is different from all of these and arguably more consequential for one reason, that there's no alternative.

If the Suez Canal is blocked, ships can go around to the Cape of Good Hope.