Houthi Tanker Strikes Send ICE Brent to $100 as Saudi Arabia's Two Export Corridors Come Under Simultaneous Attack
Tehran-backed rebels hit two Saudi crude tankers in the Red Sea on July 23, closing off the workaround Saudi Arabia had been using since Iran shut Hormuz.
ICE Brent crude front-month closed up 7% at $100.69 per barrel on July 23 — its highest settlement in nearly two months — after Tehran-backed Houthi rebels struck two Saudi crude tankers in the Red Sea. U.S. crude also closed higher by 6.2%, settling at $92.19, its best close since June 4. Oil prices have now risen roughly 35% since the start of July and are up more than 60% since the start of the year.6
The July 23 strikes carried specific gravity because Saudi Arabia had been routing crude through Bab el-Mandeb precisely to avoid the Strait of Hormuz, which Iran moved to close more than three months ago. That workaround is now under direct attack. Rystad Energy's Jorge Leon said approximately 2.5 million barrels per day of Saudi crude was transiting Bab el-Mandeb before the attacks, and the Red Sea corridor was carrying around 6.8 million barrels per day of combined Saudi and UAE crude — roughly half the volumes that would normally move through Hormuz in peacetime.7
Rystad had flagged this vulnerability before the July 23 escalation. In a market update sent to Rigzone late Monday (2026-07-20), the firm warned that 2.5 million barrels per day of Saudi oil was at risk as the Houthis announced their intention to impose a full naval blockade on Saudi ports. The tanker strikes were an early demonstration of that intent.3
The supply arithmetic compounds quickly. OilPrice.com reported that the Hormuz closure had already removed roughly 13 million barrels per day from global markets. A successful Bab el-Mandeb blockade would add to that loss, with OilPrice.com reporting that the Houthis could redirect up to 4 million barrels per day of Saudi exports while driving up costs through higher freight rates, greater fuel consumption, and the physical constraint that supertankers cannot transit the Suez Canal.1,4
BMI had already called the Q3 supply outlook highly uncertain before the July 23 escalation. In a report sent to Rigzone by the Fitch Group unit on Wednesday (2026-07-15), analysts said the market was more vulnerable to Hormuz disruption than it had been heading into the conflict in February, partly because fuel inventories had been drawn down across months of constrained supply. BMI's analysts also noted that the U.S. would find it harder to anchor market expectations for a short-lived, contained engagement a second time — the argument that had capped prices during the initial phase of the conflict.2
Goldman expects ICE Brent front-month to retain most of its recent gains through July and August, supported by declining global inventories, reduced Middle East production, seasonal travel demand, and a sharp slowdown in strategic petroleum reserve releases.5
The July 23 session pushed stress into adjacent markets in ways that complicate the demand side of the oil equation. The U.S. 10-year Treasury bond was trading at 4.7% on July 23, its highest level since January 2025. The average 30-year U.S. mortgage rate rose to 6.85% on July 22, its highest since July 2025. The S&P 500 fell more than 1.3% and the Nasdaq slid 2.4% in the same session. Sustained oil at these levels tightens financial conditions through inflation expectations, and that channel eventually works against the demand assumptions underlying bullish positioning.6
One dissenting signal sits in the Gulf itself. Dubai crude — the benchmark for sour Gulf barrels — was quoted at $80.11 per barrel as of July 25, against ICE Brent front-month at $98.70 per barrel. A spread of nearly $19 can reflect severe logistics risk priced into Atlantic-basin supply rather than a physical shortage of Gulf crude, and some storage-driven bearish pressure on the Dubai benchmark points to physical availability in the region even as export routes above it remain contested.
About 12% to 15% of global maritime trade worth more than $1 trillion transits the Red Sea annually, according to NBC News, compounding a tanker market already stretched by the Hormuz closure.6 ICE Brent front-month has pulled back from July 23's $100.69 close to $98.70 as of July 25 (2026-07-25), with U.S. crude similarly lower at $85.15.
The question markets will price when they reopen is whether July 23's strikes represent the opening phase of the full naval blockade Rystad warned about on July 20 — or a limited demonstration that stops short of sustained interdiction. BMI's analysts noted ahead of the attacks that the tail risk of a second escalation phase was not adequately priced; two weeks on, traders will assess whether that gap has closed or whether the blockade threat is still only partly reflected in the curve.3,2