Houthis seize Red Sea strait, damage Saudi pipeline; oil surges past $105

Yemen's Houthi rebels have taken control of the Bab al-Mandab Strait—a critical chokepoint between the Red Sea and Indian Ocean—after seizing the port of Mokha and key offshore islands including Perim Island. The seizure followed the collapse of the anti-Houthi alliance, triggered by a December dispute between Saudi Arabia and the United Arab Emirates over weapons shipments. Saudi forces bombed weapons arriving for UAE-backed groups, leading Abu Dhabi to withdraw from the conflict and fracturing the coalition that had previously contained Houthi expansion.

Simultaneously, Houthi drone attacks have damaged Saudi Arabia's East-West pipeline, a 745-mile cross-country link that transported an estimated 4–5 million barrels daily to the kingdom's Red Sea ports. The pipeline closure forces Saudi Arabia to reroute crude through the Strait of Hormuz and Suez Canal, routes that significantly extend shipping times. Saudi officials announced plans to restore approximately half the pipeline's capacity within days, with full recovery potentially taking up to six weeks if no further attacks occur. Exports from the Yanbu Red Sea port have already dropped by nearly half, with only 5–7 days of available inventory following the attack.

The dual disruptions have triggered sharp oil price movements. Brent crude surged to $108 per barrel in mid-September, up from $80 in early August—a spike amplified by reports that Saudi Arabia suspended loadings at Yanbu and began cancelling or delaying crude shipments to European refiners into October and November. Oil subsequently retreated as market expectations adjusted to Saudi recovery efforts, though prices remain elevated above $105 per barrel. The price volatility reflects tighter global energy buffers: seaborne tanker storage has been depleted, the U.S. Strategic Petroleum Reserve has released approximately 130 million barrels, and diesel prices in the United States have reached historic highs above $6 per gallon.

The escalation has triggered diplomatic activity at multiple levels. Qatar, acting as a regional mediator, warned of a "catastrophe" if anti-Western forces secure long-term control of both the Bab al-Mandab and Strait of Hormuz, and is attempting to revive stalled talks between Iran and Gulf Cooperation Council states. Saudi Arabia delayed these talks, citing Iranian-backed Houthi attacks on Saudi cities. Iran's foreign minister travelled to Beijing to discuss China's possible role in resolving broader Middle Eastern disputes. The UN Security Council held an emergency meeting, with calls for Houthi restraint, while President Trump is expected to meet Gulf leaders at the UN General Assembly. Houthi leaders have communicated with US Vice President JD Vance, stating their aim is to hinder Saudi-owned shipping and pressure the kingdom to end what they view as a blockade of Houthi-controlled territory.

The combined impact of pipeline damage and strait control has intensified supply concerns in Asia, where countries including India (51% of oil from Saudi Red Sea ports), the Philippines (37%), and Pakistan (36%) have become heavily dependent on Red Sea shipping routes. The disruption compounds existing energy stress from the US-Iran conflict, which has partially closed the Strait of Hormuz (averaging only four ships crossing daily compared to 130 in peacetime), and the Russia-Ukraine war, which has damaged Russian refinery capacity. The UN has warned of a humanitarian crisis in Yemen, with 100,000 Yemenis already displaced by the fighting.