Oil prices rise after the Huth threat of maritime blockade to Saudi transport

Brent Oil, the global standard of reference, increased by 1.8%, reaching $90.85 per barrel, just before 0800 on the US Eastern Time (ET). WTI oil, the American standard, was raised by a similar percentage of $83.97 per barrel. During this month, Brent's price has increased by almost $20 per barrel, while clashes between the United States and Iran have escalated again.

Oil prices were on the rise even before the Huth rebels threatened Saudi exports through the Red Sea, a vital artery to the global oil market, warning of the deadlock of the Bab el-Mandeb Strait, a strategic crossing point at the southern end of the Red Sea.

According to the consulting company Rystad Energy, Saudi Arabia has increased exports from Yanbu port to the Red Sea to 4 million barrels a day in an effort to avoid passing through the Strait of Hormuz.

Company data on ship moving “shows that about 2.5 million barrels a day from these exports are currently moving south through ( Bab el-Mandeb, leaving this vital alternative export route directly exposed to the Hhutt's possible actions”, wrote in a review the company's top vice president, Jorge León.

At the end of 2023, the Hhutt caused major disruptions in the transportation of containers to the Red Sea as retaliation for Israel's military campaign against Hamas. The volume of container transport has not yet been fully restored to this waterway.

Meanwhile, the International Energy Agency (IEA) warned on Tuesday that global power supply security would further deteriorate if the Hormuz Strait does not reopen.

“There is no room for complacency in the safety of oil supply, in terms of escalation of fighting and the continuing decline of available commercial reserves”, said IEA Executive Director Fatih Birol's statement.