Yemen Conflict Threatens Global Oil Supply Routes

The recent surge in oil prices to $110 per barrel reflects the mounting anxiety surrounding the safety of energy transit routes. Saudi Arabia, currently struggling with a damaged East-West pipeline, faces a strategic crisis as the Houthis intensify drone and missile strikes. Commodity intelligence firm Kpler estimates a potential loss of 120 million barrels of oil if the pipeline remains offline for a single month. This disruption forces Riyadh to rely on increasingly unstable channels while the Strait of Hormuz remains effectively closed due to regional hostilities.

Washington remains hesitant to intervene directly in Yemen, wary of another protracted military entanglement ahead of midterm elections. Despite Riyadh's requests for support, President Donald Trump has largely rebuffed calls for expanded military action. While Houthi leaders have provided assurances to U.S. officials in Oman that they will avoid targeting international shipping, the risk of miscalculation remains high. Gregory Brew of the Eurasia Group notes that the convergence of the Saudi-Houthi and U.S.-Iran conflicts exerts relentless pressure on international supplies, with Goldman Sachs analysts warning that prices could climb to $120 per barrel if the instability persists.