While global oil prices near US$100, the real story is the failure of the international community to secure a vital waterway. The Houthi attacks are not an act of God but a deliberate campaign against commercial shipping, enabled by a vacuum of naval power. Letting the market absorb the cost while doing nothing to stop the attacks amounts to a tax on the global economy paid to an armed group.
Naval coalitions exist, but they have been reactive and slow. The United States launched Operation Prosperity Guardian in December, yet attacks continue. European and Asian nations have sent ships, but the response lacks the coordinated resolve to deter the Houthis. Meanwhile, shipping companies are forced to take long detours, burning extra fuel and emitting more carbon. Insurance premiums have spiked, and the costs are passed down to consumers.
This is not a supply problem; it is a security problem. The solution lies in decisive military action to neutralize the threat, coupled with diplomatic efforts to address the Yemen conflict. Waiting for prices to stabilize on their own is wishful thinking. Every day of inaction adds to inflationary pressure and enriches the Houthis.
For Canadian consumers, the impact is direct: higher gasoline and heating bills. Ottawa should press for a robust international naval escort operation. Without it, $100 oil is just the beginning.