Why Houthi military gains in Yemen may further increase gas prices

A fighter with Yemen's Houthi rebels carries a rocket-propelled grenade launcher as they march during a mobilization campaign in Sanaa, Yemen, Thursday, Sept. 10, 2026. STR/AP hide caption

DUBAI, United Arab Emirates - A tenuous years-long truce in Yemen unraveled further this week as Iran-backed Houthi fighters pushed out Saudi-backed Yemeni forces along a key stretch of Red Sea coastline.

Statements by the Houthis and a rival Yemeni commander, who's cited by The Associated Press, said Friday the Iran-backed group had taken control of the port city of Mokha, just north of the Bab al-Mandeb waterway.

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The fighting in Yemen, and the Houthis' targeting of Saudi oil carriers around that waterway, coincided this week with another exchange of fire in the Persian Gulf between the United States and Iran.

As a result, the price of Brent crude—a global metric for oil prices—shot up to nearly $110 a barrel. The London-based research firm Capital Economics says the fighting on both sides of the Arabian Peninsula raises the risk of even further energy price hikes in the coming weeks.

AAA says gasoline prices in the United States are up by 34% from last year at this time, averaging $4.28 a gallon now. Diesel, used for farming and trucks, is up by 61%.

Data from maritime analytics firm Kpler, and cited by multiple news outlets, shows Saudi Arabia exported just 3.2 million barrels a day last month, its lowest level in more than a decade.

While higher oil prices help Gulf Arab producers like Saudi Arabia offset the sharp fall in their energy exports, they still face growing budget deficits, in part due to attacks on ships in the Strait of Hormuz.

Now, Saudi oil tankers run a gauntlet to bypass the Houthi attacks in the southwestern Bab al-Mandeb shipping corridor, squeezing one of the world's biggest oil producers.

Saudi Arabia is also a key stabilizer of energy prices in OPEC, but with its exports curtailed by the two conflicts and other Gulf Arab producers struggling to get oil and gas out, countries around the world are digging into emergency oil reserves to plug the gap, leading to higher prices.

Saudi Arabia had been re-routing its crude through an east-west pipeline leading to the Red Sea as a fallback measure to keep oil flowing following the closure by Iran of the Strait of Hormuz in response to the U.S.-Israeli war.

The Houthi attacks on shipping have forced Saudi Arabia to use a much longer and costlier route through the Suez Canal to the Mediterranean Sea and around Africa in order to reach buyers in Asia.

The Houthi takeover of the Yemeni port city of Mokha comes just days after the group fired missiles and drones at four regions of southwestern Saudi Arabia. The group says the attacks were in response to dozens of Saudi airstrikes on Yemen, including one that killed civilians at a prison.

The Saudi Energy Ministry said the Houthis struck Saudi oil facilities, sparking fires that halted operations on Tuesday. Saudi Arabia said more than 70 people were wounded in the attacks.

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The renewed fighting in Yemen comes 11 years after Saudi Arabia first led a coalition of Arab countries into war in Yemen to roll back a Houthi takeover of the capital, Sanaa, and reinstall Yemen's government to power. More than a decade later, the Houthis still control Sanaa.

The U.S. says the Houthis are another regional proxy of Iran, supported by weapons and training. Iran's Foreign Ministry said in statements this week the Houthis, which Iranian leaders refer to as "the resistance", are independent and operate on their own authority.

The deadly fighting in recent days for control of Mokha and other areas of Yemen's western coast has displaced at least 18,500 people , according to the United Nations' International Organization of Migration.

It says families are fleeing with nothing and arriving at humanitarian sites that already lack emergency food stocks and shelter supplies.

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