red sea

The U.S. war with Iran escalated again Thursday as Iran-backed Houthis in Yemen attacked two Saudi Araian oil tankers in the Red Sea, causing global oil prices to surge amid fears of yet another vital energy corridor being choked off by the conflict.

The attacks came after the Trump administration threatened additional strikes on Iran’s nuclear infrastructure while pushing a new deal to help Saudi Arabia develop a nuclear energy program of its own. Also Thursday, four Republicans in the U.S. House joined Democrats in a vote to halt the American military campaign absent congressional approval. Senate Republicans blocked a similar measure.

The price of oil hit $100 a barrel for the first time since May, increasing the financial pressure on Americans at the gas pump and the political pressure on President Trump to end a war he promised would last weeks but has persisted for months. At least 18 U.S. service members have died in the war.

The Houthis, who control the populous northwest of Yemen, receive arms and training from Tehran but had remained largely on the sidelines since the U.S. and Israel launched the war. Their latest strikes complicate already fraught negotiations between the U.S. and Iran after the collapse of a ceasefire this month amid renewed hostilities in the Strait of Hormuz, the other major energy passageway choked by the conflict.

The Houthis had this week announced a naval blockade of Saudi ships in the Red Sea, which stretches along Saudi Arabia’s western flank. That blockade centered on the Bab al Mandeb strait, the only southbound route for Saudi tankers headed to Asian markets.

Tanker traffic has already been heavily diminished in the Persian Gulf along Saudi Arabia’s northeast flank and between it and Iran, because of Iran’s threats to vessels traveling through the Strait of Hormuz. Saudi Arabia had diverted its oil exports to its Red Sea ports and out the Bab al Mandeb, dispatching some 4.5 million barrels via that route per day.

In a social media post Thursday, Trump said that if the Houthis continue attacking ships in the Red Sea, the U.S. “will hold Iran responsible” because the Houthis are an Iranian proxy, and inflict “major military punishment” on the Houthis and Iran.

He said he was “very disappointed” in the Houthis, “in that they have, until now, acted very professionally and smart” amid the Iran war.

At a later event Thursday, Trump said the U.S. is “doing extremely well” against Iran, which he accused of having “evil intentions.”

Democrats in the House and Senate cited the war’s spread to the Red Sea as yet another reason that Congress should act to pass a war powers measure to halt the president’s military campaign. Sen. Chris Van Hollen (D-Md.), who led the unsuccessful effort in the Senate, cited the expansion while recalling how Trump had claimed victory in Iran as far back as March.

“If we won back in March, why are more Americans getting killed in July? If we won back in March, why is the Strait of Hormuz closed? If we won back in March, why is the war expanding as Houthis attack ships transiting the Bab al Mandeb strait in the Red Sea? If we won back in March, why are oil and gas prices and diesel prices shooting through the roof again, imposing costs on every American family?” Van Hollen said. “Is that their definition of winning?”

The Houthis’ military spokesman, Yahya al-Sarea, said the group’s forces conducted “a qualitative military operation” targeting two Saudi oil tankers with missiles and drones for what he said were violations of the Houthis’ blockade on the Red Sea.

The Houthis have accused Saudi Arabia of imposing a blockade on airports and seaports in northwestern Yemen, where most of the country’s population lives and which the Houthis otherwise control. They also blamed Saudi Arabia for an attack this month on Sanaa’s airport to prevent the landing of a plane carrying a Houthi delegation returning from the funeral of Iranian Supreme Leader Ali Khamenei, who was killed at the start of the war.

Al-Sarea said that in addition to striking the two tankers, the Houthis forced 10 other ships to turn back from their passage, will “continue their naval operations against the Saudi enemy” and will “continue imposing the equation of blockade against blockade.”

The escalation of the war — and the shock wave it sent through global energy markets — added to regional uncertainty already being stoked by the Trump administration’s announcement Wednesday that it had agreed to work with Saudi Arabia to develop a civilian nuclear program.

That announcement, after years of U.S. attempts to block nuclear proliferation in the Middle East, sparked widespread concern in Washington, where lawmakers will vote on the deal, and in Israel, which has long feared a nuclear arms race in the region.

Trump administration officials said the deal would “uphold the highest standards of nuclear safety and nonproliferation,” with American firms developing the program. But they provided few details, and questions immediately arose about the absence of clear inspection protocols or any requirement that Saudi Arabia first normalize diplomatic relations with Israel.

On Thursday, Trump said the deal would be conditioned on Saudi Arabia joining the Abraham Accords and establishing diplomatic ties with Israel. White House Press Secretary Karoline Leavitt later said that Trump had not talked to Saudi leaders since making that condition public, but that they would have to agree to it or “the deal is off.”

Leavitt said that Trump had raised the matter with Saudi leaders in the past, and that it is something Trump “feels very strongly about.”

Asked whether Israel pressured the president to impose the condition, Leavitt said, “Not to my knowledge.”

Earlier this week, Defense Secretary Pete Hegseth told Congress that the Iran war has already cost the U.S. $37.5 billion. House Republicans on Wednesday pushed through a $1.15-trillion defense policy bill to fund the war moving forward. Most Democrats voted against the measure in protest of the war, and it faces stiff opposition in the Senate.

Trump in recent days has tried to deny polls showing plummeting support for the war among Americans. On Wednesday, before attending the dignified transfer of the bodies of U.S. service members killed in the war to Dover Air Force Base in Delaware, Trump claimed Americans don’t want high gas prices but “aren’t against the war.”

On Tuesday, Trump posted statistics showing that more U.S. service members died in past wars, which Democrats denounced as disrespectful to those killed in the current conflict.

The Houthis seized control of the Yemeni capital in 2014, along with much of Yemen’s populous northwest. Their advance triggered a devastating Saudi-led campaign to dislodge them. Since 2022, the two sides have been in a stalemate, though tensions have been rising again in recent months.

Mohammed al-Basha, founder of the Basha Report, a U.S. risk advisory firm focused on the Middle East and Africa, said the Houthis’ latest escalation comes as their influence is growing because of the increased importance of Bab al Mandeb while the Strait of Hormuz is choked off by Iran.

“This is their moment, because with everything happening in the Strait of Hormuz, Bab al Mandeb quadrupled in importance. By exerting maximum pressure in this period, they can maximize the effect of any kinetic action they’re trying to do,” Al-Basha said.

“Their narrative is very aggressive. They want war. And they feel that because they want war and sense that the U.S. and Saudi Arabia don’t, that they will submit to their demands.”

Before the war, roughly 15 million barrels of Gulf oil passed through the Strait of Hormuz every day, as roughly a fifth of the world’s traded oil moved through the maritime chokepoint in peacetime.

ADVERTISEMENT

ADVERTISEMENT

With the channel still largely closed and prices elevated, at least seven major pipeline projects are now under construction, in planning or under discussion to push supplies out through the Red Sea, the Suez Canal and the Gulf of Oman instead, according to Gulf officials, energy companies and market analysts.

With the Iran war reignited this month, Brent crude is trading again at around $93 a barrel at the time of writing, well above the roughly $72 it fetched after June’s short-lived truce, and the US benchmark WTI has also risen to roughly $90 a barrel.

Depending so heavily on the Strait of Hormuz “is no longer a prudent long-term strategy,” said Victoria Grabenwöger, a senior researcher at the data firm Kpler.

Two escape valves already exist, and both are close to their limits.

Saudi Arabia’s East-West pipeline, built in the 1980s when Tehran threatened shipping during the Iran-Iraq war, carries crude from the Abqaiq complex to Yanbu on the Red Sea, where tankers head south towards the Arabian Sea or north to the Suez Canal.

Meanwhile, the UAE has been channelling more oil to Fujairah, its port on the Gulf of Oman about 145 kilometres south of the Strait of Hormuz.

Together the two links had a spare capacity of some 3.5 to 5.5 million barrels a day before the war, according to the US Energy Information Administration, and both now run close to full representing around 6.5 million barrels a day.

Abu Dhabi’s state oil company is also racing to finish a project it began before the war.

Its $3 billion (€2.6bn), 300-kilometre pipeline to Fujairah, laid alongside an existing line, is designed to lift deliveries by over 1.2 million barrels a day and is roughly half built, according to Kpler, which expects the official early-2027 completion target to slip to mid-2027 because the port itself must be expanded.

Even that timetable, the firm argues, only became conceivable because of the blockade.

Red Sea relief, Red Sea risk

The Red Sea route has vulnerabilities of its own, and this week served as a reminder.

Yemen’s Iran-backed Houthi rebels, who declared a blockade on Saudi-linked shipping in retaliation for the kingdom’s blockade of Yemen and an attack on Sanaa’s airport, said on Thursday they had attacked two Saudi tankers, the Encelia and the Layla, setting both on fire.

Saudi state media reported a blaze at the bow of the Encelia with no casualties, while the UK Maritime Trade Operations centre reported a tanker struck by “an unknown projectile” southwest of Al Shuqaiq.

The Iran-backed group has disrupted the Bab el-Mandeb Strait before, a maritime chokepoint carrying about 12% of world trade, and a Houthi drone strike forced the East-West pipeline itself to shut back in 2019.

Iraq’s $60 billion bet on Washington

Nowhere is the scramble more urgent than in Iraq, which draws about 90% of state revenues from oil exports and has had to cut output because of its dependence on the Strait of Hormuz.

Prime Minister Ali al-Zaidi returned from Washington last week with 48 agreements signed with American firms, spanning energy, healthcare and technology and worth more than $60 billion, according to Reuters, including tie-ups involving ExxonMobil, Shell, Halliburton, KBR and GE Vernova.

The centrepiece is a deal with Syria to rebuild the long-dormant pipeline running from the Kirkuk fields to the Mediterranean port of Baniyas, a project Iraqi state media says Chevron will execute and which the US State Department, welcoming the plan, called “a critical energy corridor” with an initial capacity of 2 million barrels a day.

Baghdad is also weighing a line from Basra to Jordan’s Aqaba.

Washington’s ambassador to Turkey, Tom Barrack, predicted the agreements would render the Strait of Hormuz “an afterthought”.

BEIRUT — Israel and Iran traded fire on Monday, all but derailing a brittle two-month ceasefire that had largely stopped the fighting in the U.S and Israel’s assault on Iran.

The tit-for-tat attacks between the two sides threaten to widen the scope of a conflict that has already killed and wounded thousands, displaced more than a million people and rattled economies across the globe — even while embroiling the U.S. in a war with no clear off-ramp.

“Israel and Iran must immediately stop ‘shooting.’ ” wrote President Trump early Monday on his social media platform, Truth Social.

Later, he wrote, “Both sides, Israel and Iran, are looking to do an immediate CEASEFIRE!”

“Final negotiations on ‘Peace’ are proceeding, subject to ignorance or stupidity getting in its way. The Blockade will remain in place, and in full force and effect, until a ‘Final Deal’ is reached. Things should move quickly.”

The latest escalation came after Israel attacked the suburbs of Lebanon’s capital Beirut on Sunday in what it said was a targeted strike against Hezbollah, an Iran-supported paramilitary faction and political party.

In recent days, Iran conditioned a ceasefire agreement with Israel and the U.S. on a cessation of hostilities across all fronts, including Lebanon, threatening it would respond to any Israeli action on the Lebanese capital. Israel rejects linking both battlefields, and insists on having a free hand to attack Hezbollah.

A number of U.S.-brokered ceasefires between the Lebanese and Israeli governments — but without Hezbollah involvement — failed to stop most of the fighting, with Israeli warplanes pounding wide swaths of Lebanon’s south while Hezbollah launched drones and missiles on northern Israel. Nevertheless, the Lebanese government has rejected being included in Iran’s negotiations with the U.S.

By Sunday night, Iran’s threats came to pass with several waves of Iranian ballistic missiles, which caused no injuries and were the first Tehran had fired at Israel since a ceasefire took hold in April. Iran’s military said the fusillade was a warning. But Israel said it would retaliate.

President Trump initially downplayed the Iranian attack on Sunday, saying in an interview with the Financial Times Iran’s barrage was “not going to have any impact on the deal.”

“We’ll see how it ends up. But they [the Iranian strikes on Israel] were attacks that did not kick at all,” he said.

“The deal may make it on its own merit, or not, but this will not have any effect on it.”

Trump also told the Axios news site he would talk to Israeli Prime Minister Benjamin Netanyahu to stop him retaliating against Iran’s barrage.

He also told the Financial Times that Netanyahu “won’t have any choice” but to accept the deal Trump negotiates with Iran.

“I call the shots. I call all the shots. He [Netanyahu] doesn’t call the shots,” Trump said.

Yet by the early morning on Monday, dozens of Israeli warplanes were striking western and central Iran. They hit a petrochemical complex in Mahshahr in southwestern Iran, and waged extensive strikes on “strategic defense systems,” according to Israeli military statements, in what observers said was a prelude to a wider offensive. Residents in Tehran, Isfahan, Tabriz and Shiraz reported powerful explosions.

The Israeli military said in a statement it expected several days of fighting with Iran but was prepared for a prolonged campaign. It said the strikes on Iran were conducted by Israel on its own, but that they had been done in “full coordination” with U.S. Central Command, which also helped in intercepting Iranian missiles launched at Israel.

But that distinction appeared to matter little to Iran’s foreign ministry spokesperson, Esmail Baghaei, who said in a press conference on Monday that the U.S held direct responsibility for recent ceasefire violations and Israel’s action “cannot be looked at in isolation from the U.S.”

“No one believes the Israeli regime would take any action without coordination with the United States,” he said.

“The U.S. bears responsibility for the Israeli regime’s aggression, and it will also be responsible for the consequences of any escalation in tensions.”

Iran launched additional barrages throughout Monday, targeting Israeli airbases in Nevatim and Tel Nof and a petrochemical plant in Haifa, according to a statement from Iran’s Revolutionary Guard Corps. It added Israel was engaging in “a dangerous game by targeting civilian and oil infrastructure — a game that will now encompass all regional energy targets, with global economic consequences resting on America.”

The renewed hostilities also saw Yemen’s Houthis — who receive support from Iran and Hezbollah, and are part of a regional network of Iran-backed factions — enter the fray with a pair of ballistic missiles lobbed at Israel. The Israeli military said one of the missiles was intercepted; the second fell short of Israel.

Houthi spokesman Brig. Gen. Yahya Sarea confirmed the attack in a televised statement on Monday, and said Israeli maritime navigation in the Red Sea would be targeted.

During the Gaza war, the Houthis attacked commercial shipping in the Red Sea — including ships with no link to Israel — to pressure Israel into lifting its blockade on the enclave.

But, unlike Hezbollah, which attacked Israel on March 2, three days after the U.S. and Israeli campaign on Iran, the Houthis had refrained from helping their ally, until Monday.

Their involvement now raises the specter of another squeeze on energy markets already beleaguered by closures on the Strait of Hormuz. Since the U.S.-Israeli assault, the Red Sea has acted as the main alternative conduit for energy supplies, especially for those from Saudi Arabia. If the Houthis closed the Bab Al-Mandab Strait, it would all but paralyze commercial flows.

Oil prices spiked in the wake of the exchanges, with Brent Crude rising 5% to hit $98 a barrel.