Almost immediately after angry Egyptians took to the streets last week, oil jumped to over $100 a barrel. It was the first time oil hit triple digits since the record spike to $147 two years ago. Clearly, investors were spooked at even the thought of a disruption in energy production and shipping.
On Monday, we got a glimpse at one important reason why. A leading Muslim Brotherhood member said the Suez Canal should be immediately shut down.
Muhammad Ghannem made the provocative statement to an Arabic-language Iranian news network. He also said Egyptians should “be prepared for war against Israel.”
It was a chilling peek at what might happen once the dust settles from these popular protests sweeping Egypt. Western optimism notwithstanding, the Muslim Brotherhood will likely end up in power—which means the Middle East’s most populous and influential Arab country is about to lurch from relatively stable, moderate ally to volatile, radical enemy.
The shock waves will be massive. This will revolutionize the landscape in the most combustible part of the world. It will embolden extremists like nothing since the 1979 Islamic Revolution, and place formidable levers of power in their hands.
Control over the Suez Canal is definitely one of those levers. It’s a prime example of why Europe is watching events in Egypt so intently.
The Suez Canal is one of the engineering marvels of the modern world. It cuts through 118 miles of Egyptian countryside, connecting the Red Sea with the Mediterranean, thus linking Europe with East Africa and Asia. Initially completed over 140 years ago—after 1.5 million laborers moved more than 1.2 billion cubic feet of soil with picks and shovels—to this day it remains a conduit for roughly 8 percent of global seaborne trade.
Of particular concern is oil. Though Egypt exports none itself, the U.S. Energy Department still classifies it as one of the few World Oil Transit Chokepoints. Every day, 2 to 3 million barrels of oil and fuel products pass through the canal and the Suez-Mediterranean Pipeline, which also traverses Egypt. That amounts up to 2.5 percent of global oil production.
According to Barclays, about two thirds of that energy is traveling north toward Europe. It accounts for 5 to 7 percent of Europe’s oil consumption.
Disrupt these shipments, and European supply—and global prices—would be “affected tremendously,” Dalton Garis, an associate professor at an Abu Dhabi energy-research center, told the Wall Street Journal.
The New York Times reported on the same possibility: “While [oil] prices are set globally, the immediate impact of any interruption would be felt primarily in Europe, which relies heavily on jet fuel, heating oil and other distillates refined in the Middle East and shipped via the canal and pipeline” (emphasis mine). Already this past week, European oil prices have soared—even higher than those in America.
Investors are concerned that Egypt’s instability makes ships passing through the canal more susceptible to attack. Worse, though, is the prospect of a radical, anti-West government taking over Cairo and shutting the canal down altogether, a likelihood Barclays Capital warned of this week. Oil tankers transporting Middle East oil westward would have to travel the extra 6,000 miles around Africa, delaying delivery times and markedly increasing costs. That’s the last thing a continent mired in economic problems wants.
One could be forgiven for thinking that Ghannem’s call to close the canal was calculated to panic Europeans.
“People talking about the closure of the Suez Canal are talking about a collapse of the state, which it is in our interest to avoid at all costs,” Italy’s foreign minister, Franco Frattini, said Monday. “This is one of the reasons why Egypt’s stability is fundamental for the economy too, as a result of trade in the Mediterranean and therefore with Europe.”
Remember, the Suez Canal was once before at the heart of a war. In fact, current conditions resound with echoes of that history.
On one side was an Egyptian leader with a vision of militant pan-Arabism that put him at odds with European colonial powers. Colonel Gamal Nasser had taken part in a coup against the Egyptian monarchy in 1952 and then overthrown the president two years later. In July 1956, in a purposeful display of Arab strength, he seized control of the Suez Canal.
On the other side were the canal’s European owners. The canal was the West’s most prominent asset in the Middle East: At the time, a full four fifths of Western Europe’s oil was passing through it. France, Britain and Israel responded to Nasser’s provocation by combining forces to invade.
In what has proven to be a terrible blunder, the United States broke from its British ally and came out firmly against the action. The United Nations, beholden to Third World opinion, also dissented. In the end, a ceasefire was imposed, and control of the vital Suez Canal was yielded up to Egypt. It was a massive defeat for Britain in particular, marking its unmistakable loss of status as a great power—and the fulfillment of a biblical prophecy that it would lose control of its sea gates.
Since that event, Europe has significantly reduced its dependence on Suez. Nevertheless, in these economically strained, extremely oil-dependent times, the Suez Canal remains very significant strategically.
The prospect of a Muslim Brotherhood government gaining control over this asset—punctuated by the explicit call for its closure by a prominent member—makes it easy to imagine a militant Egyptian government again using the canal to provoke a European power.
This time, however, the players would be somewhat different. On one side would be the Muslim Brotherhood, an organization sure to prove even more aggressive than Nasser was (at one time, it actually tried to assassinate Nasser). And on the other, rather than a fading Britain, would be a surging, unified Europe. These differences would result in a far different outcome than the war in 1956.
Longtime Trumpet readers are well familiar with the end-time prophecy in Daniel 11—set to be fulfilled soon—of a “push” by an Iranian-led, Islamist Middle Eastern power (“the king of the south”) of a German-led European empire (“the king of the north”). Our editor in chief has speculated about the likelihood of oil factoring into this provocation: Iran could well gain control over supplies to such an extent as to be able to drive prices to uncomfortable highs. “This in turn could cause Europe to quickly unite into the most powerful economic bloc in the world,” he wrote in the Trumpet’s December 1994 edition.
The European empire described in biblical prophecy—and presently coalescing, even amid financial troubles—is a voracious economic power, and unimaginably ferocious in securing the energy and other resources it needs to fuel itself.
It is important to note that, in Daniel’s prophecy, when a unified Europe wipes out Iran, it violently overthrows Egypt in the process (“and the land of Egypt shall not escape,” Daniel 11:42 tells us). Clearly, the links between Iran and Egypt will be strong and deep by that point—so much so that Europe will feel compelled to eliminate them both in a stroke.
Today, the ideological similarities and informal ties between the Muslim Brotherhood and Iran are well known. This is a major reason why we have been saying for two decades that the Brotherhood was destined to come to power in Egypt. Daniel’s prophecy reveals that this Arab state would experience exactly the sort of lurch toward extremism that we see unfolding before our eyes today.
How much might the Brotherhood’s use of the Suez Canal as a weapon factor in to the king of the south’s “push”—and the king of the north’s violent response? We know that Egypt will not escape the European whirlwind. Perhaps today’s $100 oil and a threat to close the canal give us a clue as to why. •
