Global Energy Markets Face Growing Instability as Houthi Takeover Adds to Fossil-Fuel Risks

The Houthis have taken control of the Yemeni Red Sea coast, including the port of Mokha and Perim Island. These positions allow them to monitor or threaten one of the world's most important shipping routes: the Bab el-Mandeb Strait.

This development is alarming in itself, but it adds another layer of complexity to an already precarious energy landscape. The Strait of Hormuz on the other side of the Arabian Peninsula has been severely disrupted, forcing Saudi Arabia to rely more heavily on its East-West pipeline to move crude from the Gulf to Red Sea export terminals.

The temporary shutdown of this pipeline illustrates perfectly the fossil-fuel insecurity that pervades global energy markets. When one chokepoint becomes dangerous, oil is sent across the desert; when another becomes a threat, tankers consider taking the Cape of Good Hope route. Each alternative adds distance, cost, and infrastructure to defend.

This system has been in place for decades, with each disruption discussed as an exceptional event: Russia's invasion of Ukraine, the closure of Hormuz, Houthi attacks in the Red Sea, damage to pipelines and LNG plants, and American pressure on Europe to purchase more US LNG. However, after enough exceptions, a pattern should become visible.

Europe spent decades increasing its reliance on inexpensive Russian pipeline gas, only to see prices explode when Moscow reduced supplies in 2022. The EU then turned to the United States as an alternative supplier, but this switch has created new dependencies: whoever controls the fuel Europe needs every day acquires leverage over European decisions.

The current crisis is not a failure to predict the future; warnings about energy vulnerability have been repeated for half a century. The 1973 Arab oil embargo and subsequent shocks have exposed Western dependence on Middle Eastern crude, demonstrating that dependency does not stop being dependency simply because the supplier is friendly today.