Houthis seize Bab al-Mandeb as Saudi oil exports plummet and Iran threatens Indian Ocean expansion

Key points

• Houthis have captured the Bab al-Mandeb Strait, forcing Saudi-backed forces to retreat from the southwestern coast of Yemen.
• Saudi oil production fell from 10.2 million to 6.2 million barrels per day in August, the lowest level in 36 years, due to Houthi attacks and pipeline closures.
• France announced the deployment of soldiers and radar platforms to protect the Red Sea port of Yanbu, while the UK offered limited air support.
• Iran’s Supreme Leader’s adviser warned that the conflict could expand to the Indian Ocean, specifically referencing the US-British base at Diego Garcia.
• Trump rejected a US-Iran proposal to reopen the Strait of Hormuz within seven days, stating Iran is 'losing so badly' and demanding immediate concessions.

Background

The current escalation follows a 2022 truce between Saudi Arabia and the Houthis that collapsed in July 2026. This conflict is part of a broader regional war that began in February 2026 with US and Israeli strikes on Iran, which led to Iran locking down the Strait of Hormuz. Previous ISW updates noted that the US and Gulf states have been seeking a de facto retreat from the Iran war, but military costs and political pressures have stalled diplomatic progress.

How outlets are covering it

The Institute for the Study of War (ISW) emphasizes the tactical stalemate in Yemen, noting that while Saudi and Yemeni government forces are targeting Houthi supply lines, the Houthis continue to threaten Saudi command-and-control sites. ISW highlights the strategic dilemma for the Houthis: attacking international air defense assets could trigger a multinational offensive, while refraining may allow more partners to deploy forces. In contrast, International Socialist Alternative (ISA) frames the crisis as a result of US and Israeli imperialism, arguing that the war on Iran has destabilized the region and that the Houthis have their own agenda independent of Tehran. ISA notes that Saudi Crown Prince Mohammed bin Salman requested US strikes against the Houthis but was refused by Trump. Daily Kos focuses on the diplomatic deadlock, reporting that Trump rejected an Iranian proposal to reopen the Strait of Hormuz, while Iran’s foreign minister Abbas Araghchi suggested a deal was 'better' before the US midterm elections. Daily-sun.com highlights the geographic expansion of the threat, noting Iran’s explicit warning about the Indian Ocean and the interception of six ballistic missiles targeting Yanbu and Taif.

Why it matters

The collapse of the Houthi-Saudi truce and the subsequent seizure of the Bab al-Mandeb Strait threaten global energy security, as crude oil prices have surged above $110 per barrel. The involvement of international powers like France and the UK in defensive operations signals a broader escalation of the conflict. Furthermore, Iran’s threats to expand the war to the Indian Ocean and its rejection of US-led peace proposals indicate that the regional war may persist beyond the US midterm elections, with significant implications for global oil markets and geopolitical stability.

What to watch

Watch for the outcome of the Saudi-Pakistani-Turkish military cooperation talks and whether the Houthis will engage international air defense assets. Monitor the status of the East-West pipeline, which is expected to reopen in 6-8 weeks, and any further diplomatic moves between the US and Iran regarding the Strait of Hormuz. Additionally, observe if the conflict expands to the Indian Ocean as threatened by Iranian officials.