Yemen's Iran-backed Houthis have completed their takeover of the Bab el-Mandeb Strait, a chokepoint that carries roughly one-tenth of global trade. The move adds a second pressure point on energy shipments alongside Iran's disruption of the Hormuz Strait, with a GCC meeting and a possible Fed rate decision both due this week.
Yemen's Iran-backed Houthis have completed the takeover of the Bab el-Mandeb Strait after capturing strategic points in the Red Sea, according to AFP. The strait connects the Red Sea with the Gulf of Aden and forms a key maritime link between the Indian Ocean, the Suez Canal, and Europe.
A second chokepoint for energy flows
Around 10% of global trade passes through this waterway. That leaves global energy flows facing pressure from both ends of the Arabian Peninsula. Iran's disruption of the Hormuz Strait already threatens the main route out of the Persian Gulf, and Houthi control of Bab el-Mandeb now creates another bottleneck for shipments moving toward the Suez Canal.
Markets are watching for signs of de-escalation this week. A GCC meeting is scheduled for Monday, and traders are also weighing a potential Fed rate hike on Wednesday.
WTI holds near key resistance
On the daily chart, WTI crude oil got rejected near the 105.00 swing level, the upper bound of its recent channel. That reflects a mix of profit-taking and sellers positioning for a possible de-escalation, with the lower bound of the channel as their target. If the US-Iran standoff doesn't change, the uptrend could resume, with dip-buyers stepping in around key levels on lower timeframes.
On the one-hour chart, minor trendlines offer near-term reference points: buyers are looking for a break above the minor downward trendline or a pullback into the major upward one, while sellers are watching the same downward trendline and a break below the major upward one for short opportunities.
Source: Investinglive
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