Iran Directs Houthis to Prepare Red Sea Attacks, Threatening Global Oil Flows
A potential closure of the Bab el-Mandeb Strait could elevate global crude prices, impacting Bakken crude differentials and market competition.
Iran has instructed Yemen's Houthi movement to stand ready to close the Bab el-Mandeb strait if the U.S. follows through on threats to strike Iranian power infrastructure, according to a report from OilPrice.com. Senior Iranian sources and a source close to the Houthis confirmed the group is awaiting orders and has positioned stockpiles of drones and missiles in Yemen.
The Bab el-Mandeb Strait is a vital gateway to the Red Sea, accommodating roughly 7% of the world's energy trade. Any disruption could force shipping firms to redirect vessels around Africa, inflating transit costs and worsening global energy insecurity. This comes as traffic flows through the even more critical Strait of Hormuz are already severely compromised.
For Bakken operators, renewed geopolitical risk in key global chokepoints traditionally supports higher international crude benchmarks like Brent. A sustained price increase can improve netbacks for North Dakota crude, but also heightens competition from other global suppliers scrambling to secure market share via alternative routes.
Saudi Arabia faces acute risk due to its heavy reliance on the Red Sea, having diverted approximately 70% of its energy exports through the Red Sea port of Yanbu. According to the report, Saudi crude shipments through Yanbu have averaged above 4 million barrels per day (bpd) since June, a massive leap from just 973,000 bpd during the same period in 2025. Shipments surged to 4.7 million bpd after a four-year truce with the Houthis collapsed on July 13.
To mitigate the threat, Saudi Arabia is heavily utilizing its 1,200-kilometer East-West Crude Oil Pipeline (Petroline) to feed Yanbu and is currently evaluating a massive infrastructure expansion to permanently upgrade the capacity of its western pipeline and terminal networks. This effort to secure export routes means Saudi crude will remain a constant and growing competitor in global markets, including those that Bakken crude targets.
The operational decisions regarding a formal closure of the strait will be overseen by representatives of Iran's Islamic Revolutionary
Source
Bakken Wire staff
