Brent crude briefly touched above $108 a barrel on Monday after fresh Houthi attacks on Saudi Arabia and a postponed round of talks over the Strait of Hormuz revived fears of prolonged Middle East supply disruption. West Texas Intermediate rose alongside it, and the mounting military and diplomatic setbacks now threaten two of the region's most important oil corridors at once.
Brent oil futures briefly surged to above $108 a barrel before easing to trade at $107.52 a barrel by 06:24 ET, while West Texas Intermediate crude rose 2.8% to $102.86 a barrel. Houthi militants in Yemen launched fresh attacks over the weekend, and Gulf officials postponed a planned meeting with Iran over shipping through the Strait of Hormuz, undercutting hopes that diplomacy could ease the disruption.
Houthis widen the Red Sea threat
Yemeni government and Houthi officials told the Associated Press that Houthi forces deployed fighters on the islands of Greater and Lesser Hanish, about 160 kilometers north of the Bab el-Mandeb Strait. About 12% of global trade passes through the strait, Al Jazeera reported. The attacks also forced the closure over the weekend of Saudi Arabia's east-west pipeline, which has a capacity of around 7 million barrels a day and normally routes crude to the Red Sea, bypassing Hormuz.
Should the pipeline not reopen within days, up to 4% of global oil supply could be lost, Saudi oil buyers and traders told Reuters. ANZ analysts said in a note: "This is likely to put further upward pressure on oil prices this week".
Hormuz talks stall as tanker traffic thins
Oman's foreign minister said the meeting between Iran and Gulf powers scheduled for Monday had been postponed, a delay Iran's Foreign Ministry said came at Saudi Arabia's request. The setback follows U.S. Central Command's announcement that it destroyed five Iranian oil tankers on Sept. 8 in the Gulf of Oman and near Kharg Island, days after Iranian forces targeted a U.S. Navy warship.
Tanker traffic through Hormuz has fallen sharply, with only four vessels exiting the Gulf over the weekend against a 10-day average of around 14, compared with roughly 120 vessels a day before the conflict began in February.
Thinner inventories raise the stakes
Global oil inventories fell by an average of 3.9 million barrels a day in the second quarter of 2026, and the EIA expects a further 3 million barrels a day draw in the third quarter and 1.7 million barrels a day in the fourth, leaving the market a smaller buffer against supply shocks. Oil above $100 a barrel also raises transportation and energy costs that could feed into headline inflation just as major central banks weigh further rate hikes.
Sources: Commodities & Futures News, IG – News and trade ideas, The Defiant
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