Houthi Attacks Disrupt Red Sea Shipping, Push Crude Oil Prices Higher

Shipping traffic through the Bab el-Mandeb Strait declined on Sunday (26/7) after Yemen's Houthi movement attacked Saudi oil facilities along the Red Sea coast. The disruption pushed physical crude oil prices in the Middle East, Europe and Africa to their highest levels in two months last week.

The attacks have widened the impact of the US-Iran conflict, which had already disrupted oil flows through the Strait of Hormuz. Disruptions to Red Sea shipping have intensified since last week after the Iran-backed Houthis sought to blockade Saudi exports.

Only 11 commodity carriers transited the Bab el-Mandeb Strait on Sunday (26/7), marking the lowest daily total in several months, according to Kpler data. Seven of these vessels were oil tankers. Three vessels entered the Red Sea, including two very large crude carriers (VLCCs) bound for Yanbu Port to load Saudi crude oil.

Four vessels exited the Red Sea on the same day, including the Hong Kong-flagged VLCC New Explorer, carrying 2 million barrels of Saudi and UAE crude oil to Ningbo Port in eastern China. The other vessels included a tanker transporting 1 million barrels of Russian crude to China and another carrying around 750,000 barrels of Saudi crude to Pakistan.