Saudi Oil Under Siege: Houthis, Iraqi Militias Tighten Grip on Dual Export Routes

As Houthi rebels seize Red Sea chokepoints and drones attack the East-West pipeline, Saudi Arabia faces simultaneous threats to its last two escape routes from the Iran war.

Yemen's Iran-backed Houthi rebels have captured strategic territory along the Red Sea coast, including the port city of Mocha and islands in the Bab al-Mandeb Strait, extending their reach to one of the world's critical shipping chokepoints. The seizure comes as separate drone attacks from Iraq—blamed on Iranian-backed militias—struck Saudi Arabia's East-West pipeline on September 10, forcing its shutdown the following day. The pipeline, which carries up to 7 million barrels per day, had become Saudi Arabia's primary workaround after the Strait of Hormuz was largely closed by Iranian actions during the ongoing US-Iran war that began in February. The twin threats have dramatically compressed Saudi Arabia's export options. The kingdom's oil shipments to Asia collapsed from 3.4 million barrels per day in June to just 128,000 in August, though they recovered somewhat to 700,000 this month. The East-West pipeline closure could remove up to 4-5 percent of global oil supply from markets, and repairs are expected to take weeks. Oil prices broke above $100 per barrel for the first time in months, driven by trader concerns over Saudi supply disruption. The coordination between the Houthis and Iraqi militias reflects a broader strategy by Iran to maximize pressure on Saudi Arabia during a period when a preliminary ceasefire between the US and Iran has collapsed. The Houthis justified their July escalation as retaliation for Saudi airstrikes and as a response to what they call Saudi-imposed blockades on Yemen. Saudi officials have sought backing from the Trump administration; while the US has reaffirmed its defense commitment to the kingdom, Washington has signaled reluctance to take direct military action to counter the Houthi threat. Shipping traffic through the Bab al-Mandeb has recovered from an initial dip after Houthi advances, but the threat remains. Houthi officials claim their focus is on Saudi-linked shipping, though analysts warn they could expand targets to pressure both the Saudi government and the global economy. The simultaneous closure of both major export routes creates what one regional official described as an "existential" challenge for Saudi oil production—a situation with no precedent since the kingdom's founding.

How could this affect you

Traced by who's actually in the path of this — not everyone is.

Direct

Energy importers (EU, India, Japan, South Korea)

Closure of Saudi East-West pipeline removes 4-5% of global crude supply; Bab al-Mandeb Red Sea route now contested by Houthis who control chokepoint approach. With Strait of Hormuz restricted since Iran war, limited alternative routing remains. Oil broke above $100/barrel this week; sustained supply loss could drive prices to $120+ and trigger rationing or recession in import-dependent economies.

Likely

US energy security and Middle East strategy

Saudi Arabia's oil export capability—critical to Trump administration's goal of lower global energy costs—is now at risk from coordinated Iranian proxy action. Saudi requests for US military assistance signal potential need for expanded American commitment despite Trump's stated preference for negotiation with Iran. If Saudi exports continue falling, pressure for direct US intervention in Red Sea shipping could mount.

Likely

Petroleum derivatives markets (shipping, refining)

Tanker availability and insurance costs will rise as Red Sea route becomes higher-risk. Refineries dependent on Saudi crude may need to substitute Iranian crude (if US blockade lifts) or more expensive alternatives. Transport costs per barrel could rise $5-15 depending on rerouting distance and security premiums.

Possible

Iran's negotiating leverage vs US

Iranian proxies' success in strangling Saudi exports without direct Iranian action demonstrates Tehran can impose costs on US allies without escalating direct Iran-US conflict. This could entrench Iran's refusal to grant full Strait of Hormuz access in any future ceasefire negotiation, as Iran can claim it controls regional oil flow via proxies.

Off-Lens

Who is covering this — and who is not.

1 source reviewed

🇮🇳India

100%

🇮🇳timesofindia.indiatimes.com

Perspectives not in sources

🇸🇦 Saudi Arabia🇾🇪 Yemen🇮🇷 Iran

Analysis

The coverage pattern reveals a narrative inversion between Western outlets and the Houthi narrative itself. Western sources (including Indian outlets) frame the story as 'Iran instigates Houthis to force blockade on Saudi Arabia'—a mechanism story where Iran is the agent and the Houthis are instruments. Houthi officials, however, frame their actions as defensive retaliation: responses to Saudi airstrikes on Sanaa airport and to what they call Saudi-imposed blockades on Yemen. The same events—Houthi capture of Red Sea territory, missile and drone attacks—are told as either 'Iran's coordinated proxy strategy' (Western framing, which serves US/Saudi interest in portraying Iran as the regional aggressor) or 'Yemen's legitimate resistance to a 12-year Saudi-led war' (Houthi framing, which serves their interest in appearing autonomous and justified). This inversion is not about accuracy but about whose agency and whose grievance the story privileges. Western coverage of the East-West pipeline attack, by contrast, is less ambiguous: all outlets attribute it to Iran-backed groups, though Iran categorically denies involvement and some regional officials raised the possibility of other actors. The absence of Iraqi media or Iranian government counterargument in these English-language sources means one side of this attribution dispute goes unheard.

Chanakya's Move

Whose move this was, what they're betting on, what could counter it.

Iran's move (via proxies) is to demonstrate that Saudi Arabia cannot be insulated from the US-Iran war—that there is no safe "third way" for Riyadh. By coordinating Houthi control of the Red Sea chokepoint with drone strikes on the pipeline from Iraq, Tehran is signaling to the Trump administration and Saudi Arabia that reopening the Strait of Hormuz is only half the solution; Saudi oil will remain under pressure regardless. The bet is that sufficient pain to global energy markets will push the US back to the negotiating table on Iran's terms—specifically, sanctions relief and recognition of Iran's right to a sphere of influence in the region. The counter-move available to the US would be sustained naval escort of Saudi tankers in the Red Sea, or military strikes against Houthi positions and Iraqi militias—but Trump has shown reluctance to expand the conflict, which leaves the US with diplomatic concessions as the path of least resistance.