Houthis' Gains in Yemen Spark Oil Price Surge
The Houthi rebels in Yemen have made significant gains in their battle against Saudi-backed forces, taking control of key areas along the Red Sea coastline. This development has further strained tensions between Iran and Saudi Arabia, with oil prices spiking as a result.
The Houthis have consolidated their hold on the port city of Mokha, just north of the Bab el-Mandeb strait, and captured the island of Mayun, also known as Perim. This has forced Saudi-backed forces to retreat, leaving their vehicles behind for the Houthis to seize.
The Houthi leader, Mohammed Bukthi, stated that the attacks on Saudi-aligned forces are in response to the kingdom's blockade of Houthi-held areas, which he claims has led to deaths from hunger. He emphasized that the Houthis are not targeting international shipping through the Red Sea, but rather focusing on Saudi targets.
The fighting in Yemen and the Houthis' targeting of Saudi oil carriers have coincided with another exchange of fire between the United States and Iran in the Persian Gulf. As a result, the price of Brent crude shot up to over $108 a barrel briefly before settling around $105. Capital Economics warns that the risk of further energy price hikes is increasing.