Closing The Suez Canal
What happens to the United States if the Suez Canal closes? What happens if the Suez Canal comes under the control of an Egyptian government that is hostile to the USA and The West?
Instead of closing the Suez Canal, maybe they will just increase the cost of a transit of the canal to an exorbitant level. Maybe the number and type of transits will be limited.
Why should anyone in the US even care? We will be forced to care even if any of the above happens. The reason that we will care is that the cost of gasoline at the pump will increase, and it will increase A LOT.
If the Suez Canal closes, the only alternative for ship transport of oil from the Middle East will be around the Horn of Arfica. This would result in greatly increased travel time and cost for the oil tankers, and the maritime conditions off of The Horn are much less stable than a transit through the Suez.
If the new Egyptian government decides to leave the canal open but change the rules and/or cost of travel through, both the cost and supply could be affected. Think in terms of a Muslim theocracy in Egypt making The West pay the jizya tax indirectly through the oil tanker transit charges.
Coupled with the self-imposed crippling of US offshore oil production by the Administration of Barack H. Obama, the events in Egypt could very well result in prices at the pump that are double or even triple or more. Additionally, the cost for all goods and services will increase on top of the cost at the gas pump.
How will the events in Egypt and the disposition of the Suez Canal affect you in the USA? The exact results remain to be seen, but for a conservative estimate, take your monthly gasoline budget and double it, add 35% to your grocery bill, and you will begin to see the possibilities.
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