Brent Nears $108 After Houthi Strikes Shut Saudi Arabia’s East-West Pipeline

Oil extended its gains on Tuesday, with Brent crude nearing $108 following Houthi strikes on Saudi Arabia¹. Gulf states called off Monday’s planned meeting with Iran on reopening the Strait of Hormuz on the same day Yemen’s Houthis fired dozens of missiles, including at a Saudi airbase². The Houthis attacked further Saudi targets as the regional talks with Iran were postponed⁶.

The strikes knocked out Saudi Arabia’s east-west pipeline, the line that allows Gulf oil exports to bypass the blockaded Strait of Hormuz³. Saudi Arabia built the 1,200km pipeline across its territory from the Gulf to the Red Sea in the 1980s for exactly that purpose⁴.

With the bypass down, Riyadh is seeking to further boost oil supply through the Strait of Hormuz itself after the attacks forced it to halt the pipeline⁵. US Energy Secretary Chris Wright said the East-West pipeline is expected to resume operations soon, that damage assessments continue, and that Hormuz oil flows remain above 10M barrels per day⁸.

Why it matters to investors

The redundancy in Gulf export routes has been removed. The pipeline existed so that crude could reach the Red Sea without passing through Hormuz^3,4; with it offline, Saudi barrels are pushed back into the waterway that is already blockaded and contested⁵.

The second chokepoint is tightening at the same time. The Houthis have seized additional Red Sea islands, tightening their grip on the Bab el-Mandeb Strait, following the capture of other key islands last week⁷. That squeezes the Red Sea exit as well as the Gulf entrance.

Diplomacy has stalled rather than advanced. The cancellation of the Gulf meeting with Iran on reopening Hormuz removes the near-term path to de-escalation that the oil price had been partly discounting^2,6. The talks were called off on the same day as the missile salvo, which ties the diplomatic setback directly to the military escalation rather than to a separate negotiating breakdown².

What to watch

First, whether the pipeline restart matches the official timeline. Wright’s comment that operations should resume soon is qualified by damage assessments that are still under way⁸.

Second, actual throughput through Hormuz. Flows above 10M barrels per day are the figure being cited, and any decline there matters more to price than the headline conflict^5,8.

Third, the Bab el-Mandeb position. Further Houthi gains around the strait would compound the Gulf disruption rather than substitute for it⁷.