Yemen War Creates New Energy Crisis in Global Markets
The ongoing war in Yemen has created a new challenge for global energy markets. The Houthi rebels have taken control of key ports and islands along the western coast, including the Bab al-Mandab Strait, which is one of the world's most sensitive trade routes.
According to the U.S. Energy Information Administration (EIA), oil and petroleum product traffic through the Bab al-Mandab Strait surged from 5.4 million barrels per day in the fourth quarter of 2025 to 8.1 million barrels per day in the second quarter of 2026.
This increase was largely due to Saudi Arabia diverting exports via the East-West Pipeline to Yanbu on the Red Sea coast, which has become a new dependency for the kingdom.
However, last Thursday's attack on the pipeline by Iranian-linked drones at several locations in Riyadh and Al-Medina regions has suspended operations as a precautionary measure.
The Saudi Ministry of Energy announced that the launches took place from Maysan province in Iraq, while Baghdad confirmed the incident and dismissed its local operations commander.
The attack on the pipeline is one of three simultaneous points of vulnerability for Saudi Arabia: the Strait of Hormuz is constrained, the East-West Pipeline has been attacked, and the Bab al-Mandab Strait faces a Houthi threat.