Iran has instructed Yemen's Houthi movement to stand ready to close the Bab el-Mandeb strait, the vital gateway to the Red Sea, if the United States follows through on threats to strike Iranian power infrastructure. According to senior Iranian sources cited by Reuters, the Islamic Republic's leadership has already discussed the contingency plan with its Houthi allies, with the rebel forces now awaiting definitive orders to begin targeting maritime traffic. A source close to the Houthis confirmed that the group has pre-positioned stockpiles of drones and advanced missiles across Yemen's strategic highlands overlooking Hodeidah and the Gulf of Aden.
Operational decisions regarding any formal closure of the strait will be overseen by representatives of Iran's Islamic Revolutionary Guard Corps (IRGC) currently deployed on the ground in Yemen. The Bab el-Mandeb Strait accommodates roughly 7% of the world's energy trade. Any sustained disruption would force international shipping companies to reroute vessels around the Cape of Good Hope in Africa, significantly inflating transit costs and deepening the existing global energy crisis — with traffic flows across the Strait of Hormuz already severely compromised by the ongoing regional conflict.
Saudi Arabia faces particularly acute exposure given its heavy reliance on Red Sea export routes. The kingdom has diverted approximately 70% of its energy exports through the Red Sea port of Yanbu, pushing shipments through that terminal close to maximum operational capacity. The escalation follows the collapse of a four-year truce between Saudi Arabia and the Houthis, after the Iran-allied group accused Riyadh of conducting air strikes against a Houthi-controlled airport and subsequently fired missiles at Saudi territory.
Riyadh has been relying heavily on its 1,200-kilometer East-West Crude Oil Pipeline, known as Petroline, to channel crude to the Yanbu Commercial Port as a means of bypassing the congested Strait of Hormuz. Saudi crude shipments through Yanbu have averaged above 4 million barrels per day since June, a dramatic increase from just 973,000 barrels per day during the same period in 2025. Following the collapse of the truce on July 13, volumes surged further to 4.7 million barrels per day.
To mitigate the threat of prolonged multi-front shipping disruptions, Saudi Arabia is currently evaluating a large-scale infrastructure expansion to permanently upgrade the capacity of its western pipeline and terminal networks, according to reporting by Modern Diplomacy. The potential closure of both the Strait of Hormuz and the Bab el-Mandeb simultaneously would represent an unprecedented shock to global energy supply chains, cutting off major transit corridors that together handle a substantial share of the world's seaborne oil and gas trade. Source: OilPrice.com, reporting by Alex Kimani, July 16, 2026.
Additional sourcing: Reuters, Modern Diplomacy.
Source: oilprice.com