Houthi seizure of Bab al-Mandab threatens oil prices as Saudi pipeline shut
Pro-Iranian Houthi forces have taken control of the Bab al-Mandab strait, while a drone strike forced the closure of Saudi Arabia’s east-west oil pipeline, prompting a rise in Brent crude.
In a rapid offensive, Houthi fighters aligned with Iran captured the Bab al-Mandab strait, a vital chokepoint for Red Sea shipping. At the same time, a drone strike originating from Iraq forced the shutdown of Saudi Arabia’s east-west oil pipeline, further tightening global supply. Energy economist Thierry Bros of Sciences Po Paris explains that these events eliminate the last major factors that had balanced the oil market after earlier disruptions in the Gulf of Oman.
Brent crude has already breached the $100 per barrel mark and could continue climbing as the region’s instability deepens. Bros warns that the combined effect of the strait’s capture and the pipeline’s closure may trigger a new surge in oil prices, affecting both regional economies and worldwide energy costs.
Why it matters
Control of a key maritime route and a major pipeline could lift global oil prices, impacting economies worldwide.
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