Tanker companies temporarily halt traffic toward Red Sea after U.S.

Several of the world’s major tanker companies on Friday halted traffic toward the Red Sea after U.S. and British airstrikes on Iran-allied Houthi militants in Yemen.

Hafnia, Torm and Stena Bulk confirmed that they halted traffic toward the crucial trade gateway in response to an advisory from the Combined Maritime Forces, a multinational coalition led by the U.S.

“Considering these developments and in alignment with expert recommendations, we have decided to immediately halt all ships heading toward or within the affected vicinity,” Hafnia spokesperson Sheena Williamson-Holt told CNBC in statement.

Hafnia, Torm and Stena Bulk are among the world’s largest operators of petroleum product tankers, according to the the companies’ website.

The multinational coalition advised ships to avoid transiting the Bab el-Mandeb Strait for “several days,” according to a statement from the International Association of Independent Tanker Owners.

“The situation is dynamic and ships should consider holding outside of the area while a period of taking stock of the situation is undertaken until daylight on Saturday 13 January,” the tanker association said.

The Bab el-Mandeb Strait connects the Gulf of Aden with the Red Sea. Some 7 million barrels of crude oil and products transit the Red Sea daily, according the trade analytics firm Kpler.

West Texas Intermediate futures spiked more than 4% to $75.25 while Brent touched $80.75 earlier in the session. The benchmarks have since pulled back with U.S. crude trading at $72.89 a barrel and Brent trading at $78.53.

“The market is going to wait to see whether we see this spread to a significant waterway for oil like the Strait of Hormuz,” Helima Croft with RBC Capital Markets told CNBC on Friday. Some 18 million barrels of crude and products transit the Strait of Hormuz daily, according to Kpler.

Robert McNally, president of Rapidan Energy, said the key flashpoint is really Lebanon, where Israel has threatened to push Iran-allied Hezbollah back from the border area. Hezbollah is Iran’s strategic right arm, McNally said, and Tehran would have to respond.

“It’s leverage point is oil, specifically gasoline prices in an election season,” McNally said of Iran. The risk is that Tehran would respond to a major Israeli attack against Hezbollah by attacking oil vessels in the Strait of Hormuz or by targeting oil infrastructure in the Arabian Gulf, McNally said.

Goldman Sachs has said oil prices could double if there is a prolonged disruption in the Strait of Hormuz, though the investment bank views that scenario as unlikely.