Iran-backed Houthis Declare Blockade on Red Sea Oil Route, Threaten Global Energy Supplies

The Iran-aligned Houthis in Yemen announced a naval blockade on Saudi Arabia's Red Sea oil route, threatening global energy supplies and trade. The blockade, if effective, would disrupt the flow of oil from Saudi Arabia, one of the world's top oil producers, and could lead to a surge in oil prices.

Oil prices rose briefly after the Houthi statement, but later fell back as traders held out hope of a diplomatic breakthrough. The insurance cost of shipping goods through the Red Sea rose on the increased risks for merchant shipping.

The blockade could also affect trade flows through the Suez Canal, one of the world's most critical shipping lanes. The Houthi's move has sparked fears of a major escalation in the ongoing conflict between Iran and Saudi Arabia.

Iran had been pressuring the Houthis to close the Bab el-Mandeb gateway to the Red Sea if the US continued to attack Iranian power infrastructure. The full closure of the Bab el-Mandeb strait would reduce global oil supply by 7 percent, leaving most of Saudi oil exports unable to leave the region.

In response to the blockade, the US has launched a new round of airstrikes against Iranian cities and military assets. US President Donald Trump has defended the strikes, stating that every time Iran kills an American soldier, they will pay for that killing many times over.

The war has killed thousands of people, mostly in Iran and Lebanon, part of which has been occupied by Israeli forces following attacks on Israel by Hezbollah fighters who said they were acting in solidarity with Tehran.

Lebanese President Joseph Aoun is due to meet Trump at the White House on Tuesday to present a plan on how to disarm Iran-aligned Hezbollah and secure an Israeli withdrawal.

Israel also still has forces in Gaza following two years of war ignited by the Palestinian militant group Hamas' attack on southern Israeli communities on October 7, 2023.

Hamas said on Monday it had named top negotiator Khalil Al-Hayya as its overall leader, a move that an analyst said could signal a tougher stance by the group towards calls for it to disarm.