Houthi Advance Sends Brent Crude Prices Soaring
Brent crude oil prices rose to near $107 a barrel on Friday as tensions escalated in the Middle East, particularly around the Bab al-Mandeb Strait. The Strait of Hormuz and Bab al-Mandeb are critical energy shipping routes, with disruptions already affecting the former.
The Houthi movement, aligned with Iran, advanced along Yemen's Red Sea coast, seizing the port city of Mocha and moving towards strategic islands near the Bab al-Mandeb Strait. This development threatens to disrupt traffic through this waterway, which connects the Red Sea with the Gulf of Aden.
RBC Capital Markets analysts warn that a return to full-scale conflict between Saudi Arabia and the Houthis could push oil prices higher, as control around Mocha would put the group closer to the narrowest part of Bab al-Mandeb and increase its ability to disrupt shipping further south.