Houthi Attack Disrupts Red Sea Shipping and Drives Crude Prices Higher
Yemen's Houthi rebels have disrupted shipping traffic through the Bab el-Mandeb strait, a key waterway connecting Europe and Asia. The disruption has caused prices of physical crude cargoes in the Middle East, Europe, and Africa to jump to two-month highs.
The Houthi attack on Saudi oil installations along the Red Sea coast led to the lowest level of ship traffic through Bab el-Mandeb in months. On Sunday, only 11 commodity vessels passed through the strait, with seven of them being oil tankers. Three of these tankers were very large crude carriers (VLCCs) heading to the port of Yanbu to load Saudi crude.
The disruption has also affected transit through the Strait of Hormuz, where fewer than 10 commodity vessels passed through daily over the weekend, even though the US and Iran have paused strikes in the Middle East. The Houthi's goal is to blockade Saudi exports, expanding the conflict that has already choked oil supply through the Strait of Hormuz.