Houthi Strikes Raise Gulf Shipping and Oil Risks

Yemen’s Iran-aligned Houthis struck targets in Saudi Arabia on Wednesday, killing at least three people and wounding eight at a civilian airport and an oil field, while Washington prepared to move U.S. personnel and families out of missions across the Gulf region. The attacks renewed concerns about shipping and oil supplies near the Strait of Hormuz.

Houthi Strikes and U.S. Security Alerts

At least one person died and eight were wounded at a civilian airport in Dammam; a drone attack on a Saudi oil field killed two people, according to the report. The U.S. Embassy in Riyadh warned in a security alert of possible further Houthi attacks after recent deadly strikes, including at Riyadh’s airport.

Three U.S. officials said the State Department was preparing to order some personnel and family members to leave U.S. embassies across the Gulf, citing a possible resumption of hostilities, particularly with the Houthis. Two officials said the order could cover all personnel and their families at the U.S. Mission to Saudi Arabia. U.S. officials told Reuters that the State Department also planned to withdraw family members from a number of other U.S. missions in the region.

Oil prices climbed Thursday. At 00:34 GMT, Brent crude futures had gained $1.29, or 1.2%, to $110.11 a barrel, and U.S. West Texas Intermediate crude rose 97 cents, or 1%, to $98.12. Brent finished Wednesday largely unchanged. WTI eased 67 cents.

Hormuz Routes and Shipping Risks

Iranian state media reported several explosions on Wednesday in the Karpan area of Sirik, in southern Hormozgan province overlooking the Strait of Hormuz. The official IRNA news agency said, “A few minutes ago, the sound of several explosions was heard in the Karpan area of Sirik, in Hormozgan Province,” and added that “local sources have not yet disclosed the nature of these explosions.” Iranian media said the explosions’ nature and origin were unknown.

Middle East crude exports excluding Iran averaged 24.6 million barrels per day in the week to Oct. 18, despite shipping disruptions, energy intelligence firm Kpler reported. Before the war, the comparable average stood at 23.3 million barrels per day. Kpler said 40% of regional crude exports bypassed Hormuz in September, up from 17% before the war. Most exports still passed through the waterway: about 9.9 million barrels per day, or 60%, crossed the Strait of Hormuz.

Saudi Arabia and the United Arab Emirates sent more crude to terminals outside Hormuz. Saudi shipments traveled through the 1,201-kilometer East-West Pipeline to Yanbu on the Red Sea. The UAE stepped up use of its 406-kilometer Habshan–Fujairah pipeline. Kpler said the region had “rebuilt” its export system through Hormuz, Gulf of Oman ports and the Red Sea. Its summary: “The volume recovered. The route did not.”

A tanker shuttle system has also grown. Vessels load inside the Gulf, cross Hormuz with automatic identification systems switched off, then transfer cargo near Fujairah or Sohar. According to Kpler, more than 70% of crude that crossed Hormuz in August changed tankers offshore near those locations. Reuters cited Kpler data in reporting at least 18 attacks on shipping over the past two weeks. LSEG analysts warned Iran was targeting tankers beyond Hormuz, including in the Gulf of Oman, threatening crude loadings and ship-to-ship transfers.

Iranian Foreign Minister Abbas Araqchi told the Financial Times on Wednesday that Iran was fully prepared to defend itself. President Masoud Pezeshkian told state media the United States couldn’t expect dialogue while blockading and threatening Iran. The International Energy Agency put Gulf crude exports in September at 13.9 million barrels per day, more than 75% of pre-war levels. It warned that attacks and escalation risks raised freight rates, war-risk insurance premiums and other transport costs.