Houthis Threaten Oil Prices as Red Sea Transit Fees Loom
The Houthi movement in Yemen is considering imposing transit fees on commercial ships passing through the Bab el-Mandeb strait, a key gateway for oil shipments. According to Reuters, officials are weighing charges on most traffic through the southern Red Sea, with no implementation timetable announced.
The move comes after the Houthis declared a naval blockade on Saudi Arabia last week, sparking concerns about global supply chains and price volatility in the oil market. Oil prices have already risen in response, with West Texas Intermediate (WTI) crude up 6.33% to $83.32.
Historically, disruptions in the Bab el-Mandeb strait have caused significant price spikes, with past incidents leading to a 150% increase in global shipping rates almost overnight. The strait controls around 12% of all seaborne-traded oil, totaling nearly 9 million barrels per day.