International focus turns to the Suez Canal
A gunner in a Anti-submarine Helicopter mans a M-60 machine gun as the nuclear-powered aircraft carrier USS Dwight D. Eisenhower transits the Suez Canal below.
TEXT OF INTERVIEW
JEREMY HOBSON: As hundreds of thousands of Egyptian protesters continue to flood into the heart of Cairo for today's march, global energy markets are focused on the Suez Canal about a 100 miles to the east. Since it was dug in the 1800s, the canal has been a popular shortcut for ships.
For more on its significance, let's bring in Amy Myers Jaffe. She's the director of the Energy Forum at the Baker Institute at Rice University. And she joins us now. Good morning.
AMY MYERS JAFFE: Good morning.
HOBSON: So the Suez Canal -- it's a waterway that connects the Red Sea to the Mediterranean Sea. How important is it to global shipping and what goes through there?
MYERS JAFFE: The most important commodity that goes through there is oil. There's about 2 million barrels a day of oil that goes through the Suez Canal.
HOBSON: And it keeps ships from having to go around the Southern tip of Africa, which I gather would take more than a week. How important is it to Egypt's economy?
MYERS JAFFE: Well, it's very important to Egypt's economy. It's one of their many toll earners. It's definitely -- if someone was going to try to put the government under pressure, or wanted to bring more negative international attention onto the problem, it definitely could be a target. But it's not going to make any difference in the oil market what so ever. I think the impact is really psychological. If we had violence in Egypt, what if that violence spread to other countries? What if we had a contagion effect to the Persian Gulf? It's not something that's going to cause real shortages in the world. It's not something that's going to have Americans standing in line for gasoline. It's really more the contagion effect. You know, what if you had street protesters in a country like Saudi Arabia? Then I think we'd see very high oil prices very quickly.
HOBSON: Amy Myers Jaffe, director of the Energy Forum at the Baker Institute at Rice University. Thanks so much for joining us.
MYERS JAFFE: Thank you.