Today’s oil prices sparked a dangerous sense of déjà vu as they approached $110 per barrel. By this afternoon, the highest trading price for Brent briefly reached $109.74 per barrel. U.S. crude stood at $104.91.
Strait of Hormuz
The Strait of Hormuz remains largely closed, and the Iran-Oman agreement is still pending.
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Saudi Arabian Pipeline
The Saudi Arabian pipeline, one of the most critical oil pipelines, was taken out of service following an attack by a drone originating from Iraq, according to reports from Riyadh. The “East-West” Pipeline allowed ships to bypass the Strait of Hormuz, and if operations are not restored immediately, 4% of the global oil supply is at risk of being lost.
“I believe that, certainly, if these attacks continue and if there is a real threat that the Red Sea will be blocked for some time, this will mean higher prices.”
Ben Kahil – Researcher, Atlantic Council Global Energy
“I believe there will be a multilateral response to this, and that we will see further escalation in the region and more military confrontation.”
Abdulaziz Al-Gashian – Executive, Gulf International Forum
Houthis and the Red Cross
And while fears of a new crisis in the global economy are reaching a peak, the Houthis, once a rebel force, have rapidly emerged as a key player, not only in Yemen but also in the Red Sea.
“We saw oil prices rise immediately after the Houthis took control of the coastal city of Mocha. We now have confirmed reports that they have taken control of the Bab el-Mandeb Strait itself and that they have moved their forces to the strategic islands, the small islands off the coast of Yemen. So, realistically, tomorrow we’ll see an even bigger spike in oil prices.”
Baraa Shiban – Political Analyst in Yemen
Tankers and other commercial ships pass through the Bab el-Mandeb Strait to enter the Red Sea and reach the Suez Canal and the Mediterranean, and vice versa.
Watch the report by Kleio Vourkou
