How Escalating Attacks in Yemen Impact Global Oil Trade

A vessel anchored at Bab el-Mandeb Strait in the Red Sea, off the Yemeni coast southwest of the city of Taiz on July 24, 2026. —Khaled Ziad—AFP/Getty Images An escalating wave of attacks around the Red Sea has pushed oil prices above $100 a barrel, as Houthi territorial gains near the Bab el-Mandeb Strait and strikes on Saudi energy infrastructure threaten a route that has become a critical alternative to the Strait of Hormuz .

On Sunday, Yemeni government forces, which are backed by Saudi Arabia, launched attacks against the Iran-backed Houthis along the Red Sea.

The strikes were part of an effort to dislodge the Houthis after the rebel group captured the port city of Mokha and Perim Island at the mouth of the Red Sea, key positions that give the group a vantage point to threaten shipping through the Bab el-Mandeb Strait.

The Houthis also launched missiles at several areas in Saudi Arabia, and in recent weeks attacked the kingdom’s oil infrastructure and shipping.

The group declared a blockade on Saudi vessels in July, but said other countries’ commercial shipping can continue through the narrow Bab el-Mandeb.

The escalation has pushed up energy prices around the world.

It also potentially gives Iran leverage over the U.S. by threatening another maritime chokepoint , putting economic pressure on Washington just before the midterm elections.

The attacks come as diplomatic efforts to end the nearly seven-month-long U.S. and Israeli war with Iran have dropped off.

An anticipated diplomatic meeting between Gulf countries and Iran was postponed, Omani Foreign Minister Badr Albusaidi announced on Sunday.

The meeting, meant to take place in Oman on Monday, would have been the first talk between Iran and Gulf Cooperation Council countries to discuss the Strait of Hormuz since a mid-June memorandum of understanding between the U.S. and Iran collapsed .

The attacks have also reignited major fighting in Yemen’s yearslong civil war, which killed 150,000 people and created one of the world’s worst humanitarian crises.

The U.N.’s migration agency said more than 82,000 people have been displaced by fighting in Yemen since the start of September.

That includes more than 2,000 Yemenis who fled to Djibouti, which hosts a U.S. base on the other side of Bab el-Mandeb.

Here’s how escalating attacks in the Red Sea have impacted energy prices and what could happen next.