Gl in brief | 16 august
Key judgements
Maritime chokepoint pressure is extending to the Panama Canal. Disruption in the Middle East, low water levels, and Asian demand for U.S. oil supplies are contributing to increased costs.
Regional security partnerships continue to be reshaped through the MJDA, A3C and U.S. regional engagement in Asia. Partnerships, burden-sharing, and overlapping security mechanisms are emerging across the Americas, Asia, and the Middle East.
Critical mineral competition continues as Africa develops its domestic capacity, and China expands its critical mineral enforcement strategy.
Western sanctions targeting Russian networks have drawn threats of retaliation from the Kremlin. While Russia has made attempts to adapt, the threats of retaliation signal a new phase in how sanctions are evolving.
Africa
Fighting in Sudan continues with the Sudanese Rapid Support Forces launching drone strikes and land-based attacks on the city of al-Obeid. Both the RSF and government forces are massing in Kordofan. Al-Obeid is strategically significant, located between SAF-held central/eastern Sudan and RSF-held Darfur.
Critical mineral investment opportunities in Africa remain; however, governments are increasingly under domestic pressure to demonstrate the financial gains. Zambia’s election is demonstrating the politicisation of the economic benefits of mining, with political opponents disputing the economic impact of the USD 10 billion of mining investment since 2021.
Algeria continues to engage in the Sahel following the restoration of diplomatic relations with Mali in July 2026 and the transfer of military equipment to Niger. Algeria has exported attack and transport helicopters, ammunition, spare parts, and maintenance equipment to Niger. It comes at a time when Sahel states are pivoting away from Western allies towards Russia.
Dangote announced that construction of a Kenyan oil refinery would commence shortly and be completed in four years. The refinery aims to service wider East Africa and potentially Egypt in an effort to create greater energy self-sufficiency.
Strategic Indicator
African Resource and Industrial Capacity
▲ Increasing
African states are creating greater critical mineral opportunities with investment moving towards processing, refining, and downstream capacity. With increasing external competition for critical minerals, African governments are gaining greater bargaining power and leveraging agreements that seek to improve domestic economic benefits. While the benefits of external investment exist, African governments are facing growing domestic pressure to demonstrate improved economic conditions while simultaneously managing natural resources.
The planned Kenyan refinery indicates efforts to make Africa more energy self-sufficient in a broader strategy by Dangote that includes expanding African refineries and attracting foreign investment.
What to Watch
Continued military build-up around the city of al-Obeid and international efforts to de-escalate the conflict in the city.
Reported violence and disruption impacting the Zambian election along with the electoral outcome.
Increased engagement between Sahel states and Algeria.
Progress on the planned Kenyan refinery and other Dangote energy projects.
Americas
Costs to transit the Panama Canal have reached record highs. Transit slots are reportedly 16 times higher than the previous year, with the average price at USD 1.1 million. A convergence of factors includes increased marine traffic after the disruption of the Strait of Hormuz and lower water levels that have restricted how much cargo ships can carry. Asian purchases of U.S. oil instead of Middle Eastern supplies have also increased traffic flows. The Panama Canal is also becoming a stressed chokepoint, which may have downstream costs and supply impacts.
U.S. engagement in the Western Hemisphere continues at the U.S.-led Americas Counter-Cartel Coalition (A3C) in Panama, with U.S. Defense Secretary Pete Hegseth reportedly considering Colombia-U.S. joint strikes on terror networks. The recently elected Colombian President Abelardo De La Espriella's government will receive USD 1 billion in financial support for security assistance, signaling a closer alignment between the two countries on security matters.
Panama government officials met with workers and suppliers to consider the future of the Cobre Panamá copper mine. The Cobre Panamá mine was halted in 2023 after a Supreme Court ruled the mining contract unconstitutional. Global demand for copper and the economic impact of the closure have led to increased efforts to resolve the status of the mine.
Strategic Indicator
Maritime Chokepoint Pressure
▲ Increasing
The Panama Canal has become more strategically important while also managing increasing pressure. Disruption in the Strait of Hormuz has led to maritime operators seeking alternative energy sources and shipping flows, while Asian energy buyers also pivot towards U.S. suppliers. Low water levels from high summer temperatures have also restricted cargo capacity.
The convergence of factors, including reduced cargo capacity, supply pressure, and increased operating costs, is likely to lead to downstream impacts on costs and product supplies.
What to Watch
Costs to transit the Panama Canal and the potential for maritime operators to increase bidding for transit slots.
U.S. and Colombian joint strikes on drug cartels and wider U.S. military engagement with A3C members.
Progress on the status of the Cobre Panamá copper mine.
Asia Pacific
China’s detention of Japanese executives for alleged involvement in breaching export restrictions signals an expansion of enforcement from companies to individuals. China alleges that the Japanese nationals violated restrictions on rare-earth and dual-use technology exports, with authorities also increasing inspections of Japanese facilities and questioning company officials.
Undersecretary of Defence Elbridge Colby reaffirmed U.S. engagement in Asia; however, he reiterated the U.S. position of partnership, not dependency. Greater burden sharing and deterrence along the First Island Chain are considered U.S. priorities. The statements were followed by Adm. Frank Bradley, commander of the U.S. Special Operations Command, who indicated that special forces were willing to engage with Asian partners. The recent statements reinforce continued U.S. engagement with the Philippines, Japan, and South Korea.
New Zealand has granted a petroleum mining permit in an effort to increase natural gas supplies. The decision to grant a mining permit is only the second in eight years and signals a shift towards greater self-sufficiency and away from the previous government's policy of blocking offshore drilling.
Strategic Indicator
China’s Critical Mineral Restrictions
▲ Increasing
China has already placed critical mineral restrictions on Japan and Europe; however, the recent detention of Japanese nationals signals an enforcement escalation. The Chinese decision suggests individuals may be targeted, as well as foreign companies operating in China.
With suspended controls set to automatically resume in November unless China decides to extend the suspension, markets are adapting through increased pricing as operators seek to secure stock.
What to Watch
Progress on the Japanese nationals detained in China and the continued Chinese enforcement strategy against companies and individuals.
U.S. and Asian partners increasing deterrence measures in the First Island Chain, alongside joint military drills, interoperability, and Asian defence budget increases.
Progress in New Zealand efforts to increase gas production.
Europe
Russian President Vladimir Putin has threatened to retaliate against Western seizures of Russian commercial vessels. Europe and the UK have increased sanctions measures targeting the shadow fleet, with Putin stating that the strategy is “piracy and robbery.” Russia's retaliation, Putin indicated, will not necessarily be at sea, while the Pacific Fleet chief, Adm. Viktor Liina stated the navy could commence its own inspections. The Russian response indicates an escalation between Western sanctions enforcement and potential Russian countermeasures.
Conflict in the Black Sea continues as infrastructure is targeted, drawing political responses. Ukraine claims to have targeted a Russian naval base but halted attacks on oil tankers reportedly at the request of the U.S. due to the impact on oil markets. Despite Ukraine’s attacks, Russia has reportedly dismissed any potential Black Sea ceasefire. Both oil and grain markets remain disrupted. The Black Sea conflict is emerging as a conflict zone of political, military, and market convergence.
Eastern NATO partners are strengthening military defence around critical infrastructure. Concerns of a Russian false-flag attack have led to Lithuania deploying military personnel around energy infrastructure, increased security measures at Latvia’s Daugava dam, and Poland’s energy suppliers reassessing security measures. A drone of unidentified origin was shot down over Latvia, with the Baltic states reporting increased drone incursions.
Strategic Indicator
Western and Russian Sanctions Tension
▲ Increasing
Both the UK and European Union have expanded sanctions targeting Russian interests. The sanctions measures have included financial systems and have extended beyond the shadow fleet to third parties that are part of the support network, while the number of vessels targeted has also increased, including LNG vessels.
Russia has demonstrated the capacity to adapt to Western sanctions through various measures; however, the recent statements may indicate that sanctions are applying increased pressure on Russian networks. The ambiguity of the potential Russian retaliation may be intended to create greater deterrence against further Western sanctions.
What to Watch
Russia’s effort to counter Western sanctions through naval escorts or increased diplomatic statements.
Conflict in the Black Sea targeting infrastructure and naval targets, and diplomatic responses.
NATO posture in the Baltic states along with diplomatic statements.
Middle East
Iran and Oman are reportedly working towards an operating agreement in the Strait of Hormuz. Negotiations are expected to include security arrangements and potentially transit fees. The negotiations between the two countries continue, with Iranian efforts to use Hormuz as leverage while also challenging established principles of freedom of navigation.
The Mecca Joint Defence Agreement (MJDA) between Saudi Arabia, Turkey, and Pakistan indicates an emerging security architecture in the region. The agreement includes a nuclear power, a NATO partner, and a reported mutual defence clause with a geographical spread from Asia to the Middle East. Joint military exercises and defence cooperation are reportedly planned, with additional members considered, including Egypt.
The Houthis have continued to target commercial shipping in the Red Sea, with ballistic missiles striking a vessel. Attacks on commercial vessels came amid the signing of the MJDA and drew diplomatic condemnation from Pakistan. Houthi strikes continue to challenge Saudi Arabia’s position in the region and its new security partnership.
Strategic Indicator
Saudi Security Architecture
▲ Increasing
Saudi Arabia has an economic and security diversification strategy and has demonstrated deliberate efforts to build security partnerships. In 2025, the Saudi-Pakistan defence agreement was signed, which has been followed by the MJDA. The partnership will see defence collaboration and the domestic production of drones.
Saudi Arabia has also established a Multinational Maritime Defense Alliance to strengthen maritime security and maintain freedom of navigation in the region's waterways. While Saudi Arabia has traditionally relied on the U.S. for military supplies, the recent developments suggest that Saudi Arabia is not only diversifying but also creating overlapping security mechanisms to reduce dependence on a single security partner and supply chain.
What to Watch
Progress on the Oman-Iran Strait of Hormuz negotiations and international responses to statements or measures.
The MJDA operationalising the agreement through military drills, intelligence sharing, or defence cooperation.
Diplomatic or military responses from MJDA partners on any Houthi strikes on Saudi-linked targets or infrastructure.