Houthi Strikes Halt Gulf-Iran Talks on Hormuz as Oil Prices Soar

The Gulf states have called off Monday's planned meeting with Iran to discuss reopening the Strait of Hormuz, after Yemen's Houthis fired dozens of missiles and drones at Saudi Arabia's King Khalid airbase in Khamis Mushait. The attack was a retaliation for more than 300 Saudi airstrikes on Yemen in five days.

The Houthis also captured Perim Island, which splits Bab al-Mandeb in two, on Friday, and deployed fighters on Greater and Lesser Hanish, 86 nautical miles north of the strait. This has raised concerns about the security of global trade routes, as the Strait of Hormuz carries 12% of global trade, including 11% of maritime oil and 8 percent of LNG.

The closure of Saudi Arabia's East-West pipeline, which feeds the Red Sea port of Yanbu, has also caused concern. The 7-million-barrel-a-day line was knocked out by a drone attack on Friday, blamed on Iran-backed fighters in Iraq. At least four Asian refiners have received no word on loading schedules at Yanbu, which normally moves 4 million barrels a day.

Brent rose more than 3% when markets reopened Monday, touching $108 before easing to $107.22; WTI traded at $102.66. U.S. diesel hit a new record above $6.23 a gallon, part of a run-up that has already cost U.S. drivers more than $100 billion in extra fuel spending since the war began.