Houthi Blockade Closes Saudi Arabia's Red Sea Escape from Hormuz Disruption
With Bab el-Mandeb now under threat, the Yanbu pipeline route that Saudi Arabia has long relied on as a Hormuz contingency can no longer be taken for granted.
ICE Brent crude front-month was trading at $79.29 a barrel on Tuesday (2026-08-04), roughly 21% below the $100 level it hit on Thursday (2026-07-23), when reports of Houthi strikes on two Saudi oil tankers sent prices to their highest in nearly two months. The price retreat has been sharp. The underlying supply route problem has not.5
For years, Saudi Arabia's answer to any Hormuz threat was straightforward: pump west through the East-West Pipeline to Yanbu on the Red Sea coast, bypassing the Gulf entirely. Tanker tracking data cited by Rigzone showed the kingdom doing exactly that in the weeks before the Houthi announcement, exporting 5.9 million barrels a day from the two Yanbu terminals in the week ending July 17 (2026-07-17). That was record throughput on that route.3
But on Tuesday (2026-07-22), the Houthis announced an embargo on Saudi shipments through the Bab el-Mandeb Strait, the narrow chokepoint connecting the Red Sea to the Gulf of Aden. Ships began turning away from the strait's southern end almost immediately, tanker tracking data showed. Saudi Arabia now faces simultaneous pressure on both routes it uses to reach global markets.3,4
The practical effect was immediate. A Greek-owned Suezmax, the Amazon, departed Yanbu on Tuesday (2026-07-22) with more than a million barrels of crude and switched its destination to the Suez Canal — accepting the longer, costlier northern passage rather than attempting Bab el-Mandeb.3
Another vessel made a different call. According to OilPrice.com, at least one Saudi crude tanker transited the Bab el-Mandeb in the week of July 20 (2026-07-20) with its automatic identification system transponder switched off, attempting to slip through undetected. That kind of behaviour tends to drive up insurance premiums and push more risk-averse operators toward the costlier northern route.6
A MarineTraffic analyst described the Bab el-Mandeb risk picture as "deteriorating" on Wednesday (2026-07-22). The Houthis demonstrated during a previous campaign that they could strike commercial vessels in the waterway. Whether they have sustained capability to interdict Saudi-specific cargo at scale is a separate question, one the market has not yet fully priced.4
The Suez Canal had only just recovered from an earlier disruption tied to the Hormuz closure. CAPMAS data showed 529 oil tankers transited the canal in April 2026, 28% more than the previous year, with monthly revenues of $419 million, the highest since early 2024 when Houthi attacks on shipping first escalated sharply. Egyptian authorities estimate cumulative losses of at least $9 billion from the disruption period. Renewed pressure on vessels using the northern Red Sea passage would put that recovery at risk again.1
The conflict widened in mid-July. U.S. Central Command restarted its blockade of Iranian shipping and ports on Tuesday (2026-07-14), ending a ceasefire with Tehran, Foreign Policy reported. The Houthi embargo announcement followed eight days later.2
ICE Brent's fall from $100 back to $79.29 in the twelve days since July 23 (2026-07-23) sits oddly against the severity of what happened to Saudi Arabia's routing options. Dubai crude front-month is also showing bearish pressure driven by storage dynamics, a signal that parts of the physical market are not treating the route disruption as a durable supply reduction. Whether that read is correct depends on Houthi follow-through.5
The practical test is whether Saudi Arabia can move sufficient volumes through the Suez Canal to offset reduced Bab el-Mandeb transits. The Amazon's July 22 (2026-07-22) diversion and the tanker that ran the strait quietly the same week illustrate the choice operators now face at every loading. As more vessels make that calculation in the weeks ahead, the split in their behaviour will be more informative about actual Houthi interdiction capability than any announcement from Sanaa.3,6