Homeland Security News

Chakib Khelil, OPEC’s president, delivered on Monday a gloomy forecast: economic factors could drive oil to $200. Terrorist attack of the oil tanker at one of the oil shipping choke points may put world to the brink of economic crisis. A handful of oil choke points are of strategic importance for the global energy supply. Geographical constraints make them vulnerable to the terrorist attack.

What would be the daily costs of congestion in the strategic oil choke points at current oil prices approaching $120 a barrel?

• Congestion of the Strait of Hormuz will cost $ 2 Bln a day in undelivered oil costs
• Congestion of the Strait of Malacca will cost $ 1.4 Bln a day in undelivered oil costs
• Congestion of the Suez Canal and Sumed Pipeline will cost $ 0.5 Bln a day in undelivered oil costs
• Congestion of the Bosporus will cost $ 0.4 Bln a day in undelivered oil costs
• Congestion of the Bab el-Mandeb will cost $ 0.36 Bln a day in undelivered oil costs
• Congestion of the Panama Canal will cost $ 60 Mln a day in undelivered oil costs

However, should any of these events happen, the price of oil will jump above $200 a barrel.

Sources:
Federal Efforts Needed to Address Challenges in Preventing and Responding to Terrorist Attacks on Energy Commodity Tankers, Maritime Security, GAO Report, 2007