Red Sea Attacks on Ships Are Alarming—but Markets Aren’t Panicking

livemint.com:

Oil-and-gas prices rose Wednesday after recent rebel attacks in the Red Sea scrambled the shipping industry and prompted the U.S. to send warships into the region to protect a vital trade lane. But thus far the response of energy markets to the disruption has been muted compared with dramatic moves in prices sparked by some other past outbreaks of violence in the Middle East.

Benchmark Brent crude futures edged up 1.3%, surpassing $80 a barrel for the first time since late November and extending gains over the past week to 8%. Natural-gas futures rose 1.9% in the U.S. to $2.54 per million British thermal units, and 3.8% in northwest Europe to 33.80 euros a megawatt-hour.

Drone and missile attacks on ships by Houthi rebel forces in Yemen—which say they are targeting ships with Israeli links—have led major companies to bypass the Red Sea. The U.S. and allies including the U.K., meanwhile, are preparing to deploy naval vessels to deter further strikes as part of an operation called Prosperity Guardian.

There were no obvious attacks on commercial vessels in the region on Wednesday morning, said Jakob Larsen, head of maritime safety and security at shipping industry group Bimco. The stretch of water, which connects the Mediterranean Sea and Indian Ocean, is normally a thoroughfare for tankers carrying oil and liquefied natural gas as well as containerships and car carriers. That tanker traffic dipped after the Oct.

7 attacks by Hamas on Israel and has slowed again in recent days after the Houthi threat grew more severe. Oil and refined-product flows have more than halved from September levels, according to commodities-data firm Kpler. LNG traders and shipbrokers said Wednesday that more tankers carrying the supercooled fuel