The Saudis found an escape hatch for some of the world’s oil. The Houthis could slam it shut

By Anna Cooban, CNN

London (CNN) — The world, hungry for oil, got a modest reprieve earlier this month when Saudi Arabia began diverting millions of barrels of crude —ordinarily destined for ships transiting the blockaded Strait of Hormuz — to its Red Sea port of Yanbu.

But over the weekend Iran-backed Houthi militants entered the war in an escalation that threatens to sever even that lifeline.

Anything that jeopardizes Saudi oil flows out of the Red Sea will put more upward pressure on global oil prices, said Richard Bronze, co-founder and head of geopolitics at research firm Energy Aspects.

As many as 4.6 million barrels per day were loaded onto vessels at Yanbu over the past two weeks — more than three times the average over 2025, according to shipping data firm Vortexa.

That is small compensation for the 15 million barrels the world is missing out on every day the Strait of Hormuz remains shut. But those 4.6 million barrels are enough to rattle supply and, in an extremely sensitive global oil market, choking off another critical trade route would raise oil prices further and trigger or exacerbate local fuel shortages.

In late 2023, Houthi militants based in Yemen began attacking commercial vessels passing through the Bab-el-Mandeb Strait — located at the southern tip of the Red Sea and meaning “Gate of Tears” in Arabic — in retaliation for Israel’s war in Gaza. The attacks prompted shipping companies to use a longer route, adding weeks onto journeys and forcing them to spend more on fuel, insurance and seafarers’ wages.

Over the first 28 days of March, the amount of crude oil transiting the Bab-el-Mandeb Strait jumped by 21% compared with February, according to Vortexa. Those shipments are now potential targets for renewed Houthi attacks.

The price of Brent, the global oil benchmark, has soared by about 50% since the Iran war started on February 28 to trade around the $110-a-barrel level Monday.

If the Bab-el-Mandeb Strait also becomes too dangerous for tankers to cross, Brent is “very likely” to surge past $150 a barrel over the next few months, which is sooner than currently forecast, according to Artem Abramov, head of oil and natural gas research at Rystad Energy, a consultancy.

The waterway’s closure will “just break the system much faster,” he told CNN Monday. “Even the very threat of Red Sea closure is likely to impose continuous upward pressure on insurance, freight and ultimately most oil price benchmarks in the next days.”

Another blow to Asia

The Houthis officially entered the war Saturday, when they fired two missiles toward Israel. The day before, Mohammed Mansour, deputy information minister in the Houthi government, told CNN that closing the Bab el-Mandeb Strait “is a viable option, and the consequences will be borne by the American and Israeli aggressors.”

The Houthis have a range of weapons, including drones and anti-ship missiles, posing enormous risk to ships passing the strait.

To avoid the waterway, oil tankers leaving Yanbu — with the vast majority bound for Asia — would need to take a more circuitous and vastly longer route, travelling up through the Suez Canal at the northern tip of the Red Sea, west through the Mediterranean Sea, swooping down the western coast of Africa and across the Indian Ocean.

“If the Houthis start to threaten vessels then, at a minimum, this will add several weeks to the voyage times to Asia,” Bronze at Energy Aspects told CNN. “That would deepen the crude supply crunch in Asia.”

Asia is bearing the brunt of the global oil supply shock. The region relies on the Middle East for about 60% of its oil, and governments have taken measures to conserve energy during the crisis.

The Philippines, for example, has declared a state of energy emergency and shortened the work week for some government workers to four days, while South Korea has advised citizens to take shorter showers.

So far this month, all of the oil leaving Yanbu and passing through the Bab el-Mandeb Strait was destined for Asia, according to Muyu Xu, a senior crude oil analyst at Kpler, a trade data and analytics company.

If any Houthi attacks were to effectively block the strait, Xu told CNN, the Saudis would either start prioritizing crude shipments for nearby Europe —thus depriving Asia — or route oil tankers to Asia through the Suez Canal.

Xu said many parts of Asia will start to see crude shortages in April as they run down their existing stocks. “If they cannot get the Saudi crude on time, it will just make their near-term supply crunch even worse,” she added.

High oil prices are “one issue, but most importantly, they just cannot get enough oil,” she said.

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Tim Lister in Albi, France, and Nadeen Ebrahim in Abu Dhabi contributed reporting.