US-Iran War: New Escalation with Houthis, 3 Tankers Change Course, Oil Exceeds $92 Per Barrel

The conflict between the United States and Iran is dangerously escalating, with tensions now extending to the Red Sea. Houthi rebels in Yemen announced a naval blockade of Saudi Arabia and threatened to attack ships carrying Saudi oil, already causing disruptions in international maritime transport.

Three tankers loaded with Saudi crude, bound for China and India, were forced to alter their course in the Red Sea. They redirected towards the Suez Canal, avoiding the coast of Yemen and the Bab el-Mandeb strait. This development occurred as U.S. forces completed their 11th consecutive night of bombings against Iran. Tehran responded with new attacks on American facilities and infrastructure of U.S. allies in the region.

The Houthis, allies of Tehran, declared a naval blockade of Saudi Arabia, warning shipping companies they would target vessels loading or unloading Saudi oil. The threat had immediate consequences: three tankers rerouted to the Suez Canal instead of the Bab el-Mandeb strait, significantly increasing travel time and cost to Asia. Saudi Arabia had been using a pipeline to bypass the Strait of Hormuz for millions of barrels daily, but this route's traffic has been severely limited since the ceasefire collapse. Any potential obstruction of this route could severely impact Saudi exports, the world's largest crude oil exporter.

U.S. President Donald Trump stated that the Houthis had not yet closed the Bab el-Mandeb, warning that the U.S. would take action if they attempted to implement their threat. "It hasn't happened yet. If something like that happens, we will deal with it," he said. Previous U.S. military operations targeted the Houthis when the group attacked ships in the Red Sea during the Gaza war. The Houthis control much of western Yemen, including the coast near the Bab el-Mandeb, a strategically vital waterway connecting the Indian Ocean to the Mediterranean via the Suez Canal.

The threat of simultaneous disruption to shipping in the Strait of Hormuz and the Bab el-Mandeb caused oil prices to rise again. Brent crude increased by 1.1% to $92.01 per barrel, while U.S. WTI crude rose 1% to $85.16. Prices had already climbed over 2% on Tuesday, reaching a five-week high.

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So far it has not happened. If something like that happens, we will deal with it.