Houthi Gains in Yemen Raise Oil Supply Fears

Yemen's Iran-aligned Houthi militants have made significant gains in their conflict with Saudi Arabia, reaching the strategic island of Perim in the Bab el-Mandeb Strait on September 11. The move has raised concerns about oil supply disruptions and potential price hikes.

The waterway, which connects the Red Sea to the Gulf of Aden, is a critical shipping route for oil exports from Saudi Arabia, the world's largest oil producer. Control of the Bab el-Mandeb Strait could give Iran an important advantage in its conflict with the United States.

Saudi Arabia has increasingly depended on the Red Sea shipping route since the conflict with Iran effectively closed the Strait of Hormuz, through which about one-fifth of the world's oil supply normally passes. The International Energy Agency reported that Saudi crude production fell by 2.3 million barrels per day in August to six million barrels per day, its lowest level in over three decades.

The Houthis have also captured the mainland Red Sea coastal town of Dhubab, which is located opposite the island. Yemeni government forces said they planned to try to retake areas seized by the Houthis during their rapid offensive along the Red Sea coast this week.