Houthi forces in Yemen reportedly captured the port city of Mokha and the island of Perim this week, while drone attacks hit oil infrastructure in Saudi Arabia. Saudi officials said on Friday, September 11, that the East-West Pipeline was shut down in the Riyadh and Madinah regions after being struck by drones launched from Iraq. The Houthi takeover of Mokha on Thursday, September 10, would mark their most significant territorial gain since a 2022 agreement briefly halted a civil war that began in 2014.
These developments occur amid a broader conflict involving the United States, Iran, and Saudi Arabia. Saudi Crown Prince Mohammad bin Salman has reportedly urged U.S. President Donald Trump to conduct military strikes against the Houthis, according to Axios. While President Trump has declined to order direct strikes, he has agreed to assist Saudi forces with intelligence sharing and targeting development. Meanwhile, Iran and the U.S. have engaged in direct hostilities, with Tehran reporting it fired a missile at U.S. warships earlier in the week and U.S. forces reportedly striking Iranian tankers.
Satellite imagery from Planet Labs showed damage to Saudi oil pumping stations near Al Mesba’ah and Al Dhekra following the drone strikes. Saudi Arabia uses the East-West Pipeline to transport up to 7 million barrels of crude oil daily to the Red Sea, bypassing the Strait of Hormuz, which Iran has effectively closed. Houthi spokesperson Yahya Saree stated on Friday that maritime navigation remains safe for all except Saudi-owned vessels, though he warned of further escalation unless a blockade on Yemen is lifted.
For consumers, these regional conflicts translate into higher costs for fuel and goods. Diesel prices have reached $6.00 a gallon, and industry executives at the APPEC conference reported a global shortage of petroleum products. Vitol CEO Russell Hardy estimated the market is missing 2 million barrels per day from Russia and nearly 2 million from the Middle East. The impact is noted for heavy products like diesel, as Middle Eastern refineries are exporting only 1 million barrels of products compared to 9 million barrels of crude. Goldman Sachs has already raised its price forecasts for 2026 and 2027 by $5 per barrel, citing expectations that shipping disruptions will persist into next year.
The conflict also creates risks for maritime workers and military personnel stationed in the region. The recent drone strikes resulted in a "number of injuries," and the capture of strategic islands puts shipping companies in a position where they must decide whether to continue using the Red Sea or reroute around the Suez Canal, a move that adds weeks to delivery timelines. With the International Atomic Energy Agency (IAEA) confirming increased activity at Iran’s Pickaxe Mountain and Tehran signaling readiness for a "long war," no immediate date for a ceasefire or de-escalation has been reported.