Houthi Red Sea Blockade Raises Fresh Risks to Global Oil Trade

Key Points

·         Blockade announced: The Iran-backed Houthi militia has declared a blockade of shipping linked to Saudi Arabia through the Bab al-Mandab Strait, a critical maritime chokepoint connecting the Red Sea to the Gulf of Aden.

·         Shipping continues but risks are rising: Despite the announcement, dozens of vessels continue to transit the strait, although uncertainty over security has increased significantly.

·         Ships reversing course: According to maritime data firm Kpler, nearly a dozen ships have turned back from the Bab al-Mandab Strait since the blockade was announced, reflecting growing concern among shipping companies.

·         Attacks on vessels: At least three oil tankers were attacked in the Red Sea during the week.

o    On Friday, a Saudi-owned tanker sustained hull damage after being targeted.

o    The crew remained safe, and the vessel continued its voyage.

·         Tracking difficulties: Maritime intelligence firm Windward reports that more ships are switching off their location transponders (AIS) to reduce the risk of being identified and targeted by the Houthis, making it harder to assess actual shipping activity.

·         Traffic has not yet collapsed: Shipping data indicate that 43 ships crossed the Bab al-Mandab Strait on Thursday, compared with 35 ships on Wednesday, suggesting that commercial traffic has not yet been significantly disrupted.

·         Impact of Strait of Hormuz disruption: Since the outbreak of the U.S.-Iran conflict, the Strait of Hormuz has remained largely constrained, forcing Saudi Arabia to:

o    Transport crude oil via its East-West pipeline from the Persian Gulf to the Red Sea.

o    Export the oil through the Bab al-Mandab Strait, which is now also under threat.

·         Alternative routes are costly: Some shipping companies are considering rerouting through the Suez Canal, but this presents several challenges:

o    Longer and more expensive voyages.

o    The canal cannot accommodate fully loaded supertankers.

o    Oil often must be transferred through pipelines or onto smaller vessels, increasing costs and logistical complexity.

·         Global oil supply at risk: According to Windward, disruptions around both the Strait of Hormuz and the Bab al-Mandab Strait now place about 25% of the world's oil supply at risk.

·         Oil prices respond: Growing geopolitical tensions pushed Brent crude oil prices to around $100 per barrel, the highest level in approximately two months.

Significance

·         The Bab al-Mandab Strait has become a critical alternative export route after disruptions in the Strait of Hormuz. Any sustained Houthi blockade could significantly affect Middle East oil exports.

·         Simultaneous threats to two of the world's most important maritime chokepoints increase the risk of:

o    Higher global energy prices.

o    Increased freight and insurance costs.

o    Delays in international trade.

o    Greater volatility in global energy and commodity markets.

·         If attacks intensify and commercial shipping declines substantially, the disruption could have broad economic consequences, particularly for Asian economies, which are major importers of Middle Eastern crude oil.

 

[ABS News Service/25.07.2026]

Days after the Iranian-backed Houthi militia announced the blockade of a vital shipping passage through the Red Sea, dozens of ships continue to make the journey, according to a review of shipping data.

But with each hour that passes, uncertainty about the safety of the journey grows. Vessels have been making U-turns, in some cases reversing their courses on trips that were meant to stretch to India, China and other parts of the globe. In at least three instances this week, oil tankers have been attacked in the Red Sea, including one attack reported late Friday.

If the blockade succeeds in hampering shipping activity, it will be another blow to global trade already damaged by the widening conflict in the Middle East. As the United States and Iran have escalated their attacks in a war now in its fifth month, the Strait of Hormuz, the narrow waterway next to Iran that had long been the conduit for a fifth of the world’s oil supply, has remained largely cut off.

In recent months, Saudi Arabia has rerouted millions of barrels of oil per day via a pipeline that stretches from the Persian Gulf to the Red Sea. Most of that oil makes its way out of the region through the Bab al-Mandab Strait, off the coast of Yemen and near territory controlled by the Houthis.

That pathway was put at risk on Monday, when the militia announced that it would blockade ship activity from Saudi Arabia, the world’s largest oil exporter.

Nearly a dozen ships — trying either to leave the Red Sea or to enter the area — have turned back from the strait since then, according to Kpler, a maritime data firm.

It is difficult to get a full picture of shipping traffic in the area, with more ships turning off their location transponders to obscure their positions from the Houthis, said Michelle Wiese Bockmann, an analyst at Windward, a maritime intelligence firm.

And some data suggests that activity through the Bab al-Mandab Strait has increased this week despite Houthi aggression. On Thursday, Kpler found, 43 ships crossed the strait, up from 35 the day before, when the Houthis claimed they had targeted two Saudi oil tankers with missiles and drones.

On Friday, the hull of a Saudi-owned vessel was damaged after being targeted in the Red Sea, Saudi officials said. The vessel and crew were safe, and the ship appeared to continue traveling.

This is not the first time the Houthis have disrupted activity in the Red Sea. In 2024, they regularly attacked ships there with links to Israel in what the militia described as an effort to force Israel to end its bombardment of Gaza.

Now, seeking an alternative, some shippers are moving north toward the Suez Canal, Kpler said. But that route to Asia — the buyer of much of the region’s oil — is much costlier and longer. And the canal is too shallow for fully loaded supertankers, so oil has to be transferred to a pipeline before returning to tankers or transported onto smaller ships, straining availability of those types of vessels.

As a result of rising tensions in the Red Sea, on top of diminished activity around the Strait of Hormuz and elsewhere, about 25 percent of the world’s oil supply is now imperiled, Ms. Wiese Bockmann said. “It’s quite a volatile situation,” she said.

This week, prices of Brent crude oil, the international benchmark, jumped to around $100 a barrel — a level not seen in roughly two months.