Will Oil Prices Soar? Saudi Arabia's Last Rescue Route Faces Collapse

Following Houthi threats and attacks on ships in the Bab el-Mandeb strait, Saudi Arabia is forced to seek expensive alternatives for exporting oil through the Suez Canal, raising fears of oil prices surging above $100 per barrel. Recent attacks hit a Saudi vessel and prompted a military response. Oil traffic through the Saudi canal hit a two-and-a-half-year high, and imports to the Sumed pipeline surged by 50%. Brent prices traded around $97 per barrel after crossing the $100 threshold, and economists warn of a spike to $120.

Following Houthi threats and attacks on ships in the Bab el-Mandeb strait, Saudi Arabia is forced to seek more expensive and complex alternatives for exporting its oil through the Saudi and Egyptian canals, a situation that raises fears of oil prices surging above $100 per barrel. Recent attacks hit a Saudi vessel and prompted a Saudi military response against Houthi targets in Hodeidah. Vortexa data shows that seaborne oil traffic through the Saudi canal hit a two-and-a-half-year high, and imports to the parallel Sumed pipeline surged by 50%. Brent prices traded around $97 per barrel after crossing the $100 threshold, and economists at Goldman Sachs warn of a spike to $120. The logistical entanglement coincides with a slowdown in oil flow through Hormuz and Ukrainian attacks on energy infrastructure in Russia. Analysts warn that the cooperation between Tehran and its proxies creates leverage that could destabilize the global economy.