Houthis Declare Saudi Tanker Blockade as ICE Brent Crude Front-Month Settles at $98.70
A Houthi pledge to blockade Saudi oil shipments through Bab el-Mandeb has opened a second chokepoint threat alongside the ongoing Hormuz disruption.
ICE Brent crude front-month broke $100 a barrel on Wednesday (2026-07-23), rising for a fifth consecutive session after Yemen's Houthi forces claimed strikes on two Saudi oil tankers and announced a maritime blockade targeting Saudi shipments through the Bab el-Mandeb Strait. The move pushed ICE Brent crude front-month up more than 6% in a single session, RTE reported, reaching levels not seen in nearly two months before settling at $98.70 per barrel by Saturday (2026-07-26).7
Saudi Arabia routes approximately 70% of its energy exports through the Red Sea to avoid the Strait of Hormuz, which has been disrupted since the US-Iran conflict escalated earlier this year. A credible blockade at Bab el-Mandeb would simultaneously close both of Saudi Arabia's main export corridors, threatening supply flows already under severe pressure.4
Houthi forces have reportedly deployed missiles and drones near the Bab el-Mandeb Strait, with attack orders said to originate from the IRGC. The posture appears tied to a specific trigger: US strikes on Iranian power infrastructure. On Tuesday (2026-07-14), US Central Command restarted its blockade of all Iranian shipping and ports, a move Foreign Policy reported effectively ended the US-Iran ceasefire and memorandum of understanding.3,4
At least one oil tanker carrying Saudi crude transited the Bab el-Mandeb during the week of 2026-07-20 with its AIS transponder switched off, according to tracking data cited by OilPrice.com. Vessels in the Red Sea have been making unusual maneuvers, and visible traffic through the Strait of Hormuz has dropped sharply, Rigzone reported on Wednesday (2026-07-22). Transponder blackouts signal that operators are already treating the waterway as a live threat zone.8,5
"The Bab el-Mandeb risk picture is deteriorating," a MarineTraffic analyst said on Wednesday (2026-07-22), in comments reported by NBC News. The strait is the sole gateway connecting the Red Sea to the Gulf of Aden and onward to the Suez Canal. Any sustained disruption there affects not only Saudi crude exports but the broader flow of seaborne goods that pass through the Suez route — roughly 10% of global seaborne trade, including nearly 8% of world LNG volumes.6,1
The Suez Canal had only recently recovered some momentum. Egypt's state statistics agency CAPMAS reported that 529 oil tankers transited the canal in April, 28% more than the prior year, generating $419 million in monthly revenue — the highest since early 2024, when previous rounds of Houthi attacks first throttled the corridor.2
Broader traffic reached 1,182 vessels of all types in April, up 14% year-on-year, CAPMAS data show. Egyptian authorities have separately estimated cumulative revenue losses of at least $9 billion from disruption since 2024. A renewed Bab el-Mandeb closure would quickly reverse whatever recovery Egypt had managed to build.2
Not every market signal is pointing the same direction. Dubai crude settled at $80.11 per barrel on Saturday (2026-07-26), a $18.59 discount to ICE Brent crude front-month's $98.70 close. Dubai crude is widely watched as a proxy for Gulf sour barrel demand; the gap between spot Gulf barrels and the Brent headline suggests physical demand has not tightened to match the geopolitical premium priced into futures. Some analysts have flagged bearish storage signals as a contrarian weight against the geopolitical bid.
Goldman Sachs expects oil prices to retain most of their recent gains through July and August, supported by declining global inventories, reduced Middle East production, and seasonal summer travel demand, RTE reported. The bank did not specify a ceiling.7
Asian LNG buyers face their own exposure. JKM front-month was quoted at $22.00 per MMBtu on Saturday (2026-07-26), with Bab el-Mandeb serving as a key transit point for Atlantic LNG cargoes heading to Asia via Suez. Any sustained closure would divert those cargoes around the southern tip of Africa, adding transit time and cost that would feed into spot JKM pricing through August and September.1
The immediate unknown is whether the Houthi blockade declaration translates into sustained interdiction or remains largely a deterrence posture. The two tanker strikes they claimed have not been independently confirmed, and the group has used similar announcements before without following through at scale. Traders moving Saudi crude cannot treat that ambiguity as safety. The next concrete signal will be vessel-tracking data showing whether major charterers begin routing Saudi liftings away from the Red Sea entirely — a shift that would appear in AIS records within days.6,8