Oil Markets Face Dual Chokepoint Risk as Bab el-Mandeb Strains

The security landscape shifted dramatically after Yemen's Houthi militants imposed a maritime blockade against Saudi Arabia, threatening vessels near the Bab el-Mandeb Strait. The group’s subsequent drone and missile strikes on two Saudi tankers forced carriers to reroute around Africa’s Cape of Good Hope, adding two weeks to transit times. This escalation follows Saudi Arabia’s strategic pivot to the Red Sea port of Yanbu, where exports had climbed to 4.5 million barrels per day to bypass disruptions in the Arabian Gulf.

Standard Chartered estimates that roughly 7 million barrels per day were moving through the Bab el-Mandeb corridor before the attacks. Any sustained closure threatens to overwhelm alternative export routes, potentially forcing Riyadh to curtail production. European markets remain particularly exposed, as they already face supply constraints from attacks on Russian refining infrastructure. A prolonged disruption would likely force a massive reshuffle in global trade, as refiners scramble to source diesel and jet fuel from the Atlantic Basin to replace delayed shipments. While clean product tankers face the most acute pressure due to their reliance on the Suez route, the entire tanker market is bracing for higher war-risk premiums and tightened freight availability.