Iran-backed Houthi militants have seized control of Yemen's strategic port city of Mokha on the Red Sea coast, according to Yemeni and Houthi officials cited by The Associated Press, though CNBC could not independently confirm the report [1]. The capture of Mokha, located approximately 75 kilometers (46 miles) north of the Bab el-Mandeb Strait, significantly raises the threat to shipping near this vital waterway, which connects the Red Sea to the Gulf of Aden and global markets [1]. This development is seen as a severe setback for Saudi Arabia and the Yemeni forces it supports, and increases Iranian leverage around two critical oil choke points: the Bab el-Mandeb Strait and the Strait of Hormuz [1].
The strategic importance of the Bab el-Mandeb Strait has grown since the onset of the U.S. and Israel's war against Iran in late February, with the waterway serving as an alternative route for crude oil shipments to Asia [1]. Analysts fear that the Houthis' advance toward the Bab el-Mandeb Strait could have major ramifications for global trade, especially if the group escalates threats or attacks on Red Sea shipping [1]. Hamish Kinnear, principal Middle East and North Africa analyst at Verisk Maplecroft, described the capture of Mokha as a "major blow" to Saudi Arabia, noting that it opens the possibility of the Houthis exerting a tighter grip on the Bab el-Mandeb coastline and the chokepoint [1].
Oil prices remain above $100 per barrel as energy markets assess mounting supply risks in the Middle East [1]. Although oil prices traded lower on Friday morning, both major benchmarks are set to end the week above $100 per barrel for the first time since mid-May [1]. Kinnear further stated that as the conflict continues, both Tehran and Washington believe time is on their side, making a new truce unlikely in the near term. He expects oil and gas prices, particularly refined products such as diesel, to continue rising while the situation persists, even if US convoys and Strait of Hormuz export alternatives help cushion the price impact [1].
CONCLUSION
The Houthis' seizure of Mokha port has intensified concerns over oil supply disruptions and global trade routes, pushing oil prices above $100 per barrel. Analysts anticipate continued upward pressure on energy prices as the conflict shows no signs of resolution, marking a significant market risk for the foreseeable future.