Analyst: If Houthi Militia Attack Escalates, Saudi May Be Forced to Cut Output Alongside Other Oil Producers

BlockBeats News, March 28th, Energy analysts have warned that if Houthi rebels in Yemen resume attacks on Red Sea shipping, the oil market could face even greater turmoil. A renewed attack could cut a significant amount of oil from global supplies and drive up oil prices. Saudi Arabia has been working to divert as much crude oil as possible from the Persian Gulf to its Red Sea port of Yanbu, from where most of the cargo is shipped to Asia. While this has not entirely offset the volume of oil unable to pass through the Bab el-Mandeb strait, it has helped contain the global oil price surge.

Analysts said, if the Houthi attacks make it too risky for tankers to approach Yanbu, as much as millions of barrels of oil per day could be stranded in the Middle East. In that case, Saudi Arabia may have to cut production in concert with Kuwait and Iraq.