Oil prices break 100! Houthi forces open up the “Red Sea battlefield,” Trump weighs a “larger-scale war,” and Ukraine also “adds fuel to the fire.”

Oil prices break 100! Houthi forces open up the “Red Sea battlefield,” Trump weighs a “larger-scale war,” and Ukraine also “adds fuel to the fire.”

International oil prices have once again broken through $100 per barrel after two months, with threefold supply shocks fermenting simultaneously and pushing the global energy market to a new dangerous edge.

Brent crude surged above $100 during Thursday’s session, touching this key psychological threshold for the first time in two months, with the monthly increase set to mark the biggest rise since the Hormuz Strait blockade in March. Murban crude futures produced in Abu Dhabi soared to $108.

The trigger for this sharp upswing was the Houthis announcing an attack on Saudi oil tankers and threatening to blockade the Bab-el-Mandeb Strait, turning Red Sea shipping into a new battleground. At the same time, according to Xinhua citing US media, Trump is "close" to deciding whether to launch an unprecedented "large-scale attack" on Iran. Continued Ukrainian drone strikes on Russian refinery facilities constitute a third pressure, further worsening global refined oil supply.

Market analysts warn that if the Hormuz Strait continues to be blocked and the Bab-el-Mandeb Strait is indeed sealed off, oil prices face the risk of further surging to $120 or even higher. Rapidan Energy Group President and former White House official Bob McNally stated, "The scale of the second round of military conflict will surpass the first, posing tremendous risks to shipping and energy infrastructure."

Houthis Open Up "Red Sea Battlefield," Bab-el-Mandeb Strait in Crisis

This week the Houthis announced an attack on Saudi oil tankers, officially turning the Bab-el-Mandeb Strait at the southern end of the Red Sea into a new conflict front, causing a "double chokepoint" dilemma for global oil supply.

According to CCTV News, on the 23rd the Yemeni Houthis issued a statement saying, to respond to what they call the Saudi blockade of Yemen and implement their "blockade for blockade" principle, they launched a military strike on two Saudi oil tankers. According to Saudi news on the 23rd, the Saudi "Enselya" oil tanker was attacked while sailing in the Red Sea, causing the bow to catch fire, but the crew were all safe.

Media reports say Saudi Arabia immediately rerouted oil exports, using a pipeline from the Abqaiq refinery to Yanbu port on the Red Sea west coast, sending about 75% of regular exports via the Red Sea to the market. Rystad Energy’s vessel tracking data shows around 2.5 million barrels per day of crude from Yanbu currently pass south through the Bab-el-Mandeb towards distant markets such as India.

The threats from the Houthis have already had a real impact on the market. According to maritime intelligence company Windward, at least five Saudi-related oil tankers turned back after the Houthi blockade threat escalated, four carrying Saudi crude; another tanker bound for China turned back after leaving Yanbu. Additionally, three tankers shut down their automatic ship identification systems after the threat escalated.

A Saxo Bank research report pointed out that these attacks have prompted "more ships to avoid the Bab-el-Mandeb Strait, forming what analysts call the double chokepoint issue," and have brought "a new round of crude risk premium and renewed market focus on inflation."

Rystad Energy Head of Geopolitical Analysis Jorge León said, "If a truce is not achieved, and the Hormuz Strait remains basically closed, while Houthis further increase threats to Red Sea shipping, the risk of a sharp oil price rebound will be quite significant."

The Bab-el-Mandeb Strait connects the Arabian Peninsula and the Horn of Africa, with about 4.1 million barrels of crude oil and refined products transported daily last year, roughly 5% of the global total. Yet, since the US-Israeli raid on Iran at the end of February and the disruption of the Hormuz Strait, the strategic importance of Bab-el-Mandeb has surged sharply.

Trump Weighs "Unprecedented" Large-scale Strike, US-Iran Conflict Risks Soar

US-Iran military standoff continues to escalate, and Trump publicly stated he is "close" to making a decision for a large-scale strike against Iran, sharply increasing market concerns about a full-blown conflict.

Wallstreetcn article says, citing US media Axios via Xinhua, Trump said in an interview that he is "seriously considering" restarting large-scale military operations against Iran, potentially bigger in scope than the February "Epic Fury" operation. Trump said: "I am considering launching a large-scale attack, unprecedented in scale. I'm close to deciding, we've made all preparations." He also said the US military is "fully ready," Iran "wants to negotiate but isn’t ready for a deal," and "they haven't been hit hard enough."

According to Xinhua, Iran has made preparations in response to any US escalation. An Iranian military source told Russian media, "Iran’s armed forces have prepared multiple response plans for any new US attacks, especially if the US government mistakenly initiates a ground invasion." If the US strikes Iranian nuclear or infrastructure facilities again, Iran’s response will exceed US expectations.

Ukrainian Drones Deal Heavy Blow to Russian Refining Capacity, Refined Products Supply Critically Tight

Beyond the Middle East situation, continued Ukrainian drone strikes on Russian refineries serve as the third driver for rising oil prices, further worsening global refined oil supply.

According to media reports, Goldman Sachs noted that global diesel supply remains under pressure, partly because the market is highly exposed to the risk of Middle Eastern refinery shutdowns, especially Russia—Ukrainian drone strikes have cut Russian refining capacity by 80%.

International Energy Agency Director Fatih Birol warned this week that many refineries have cut fuel output due to soaring crude costs, making supplies of transportation fuels like diesel even tighter. He stated: "Recovery of refining operations and product supply lags far behind crude deliveries, which means refined oil markets—including diesel and gasoline—are much tighter than crude markets."

$100 Oil Triggers Inflation Alarm, Political Pressure Transmits to Trump

Analysis shows Brent crude breaking through the $100 psychological threshold has begun to transmit to broader economic levels and create political pressure for the Trump administration.

Brent spot prices also broke through $100, with front-month spreads showing a strong futures premium of over $6 per barrel, indicating market worries about short-term supply tightness far exceed normal levels—in normal times, this spread is only a few cents.

Meanwhile, at least one Middle Eastern crude grade's spread has doubled in the past two trading days.

Rebecca Babin, senior energy trader at CIBC Private Wealth Group, said, "The market focus has now shifted to Saudi Arabia's response. Although tankers can reroute via the Suez Canal, it's a less efficient option, requiring smaller ships and longer routes."

Rob Haworth, senior investment strategy director at Bank of America's wealth management, warned that "If oil prices stay in the $90-120 range until late summer, that's when we'll see a stronger impact on consumer spending, as wage growth can't keep up with these price increases."

US retail diesel prices are currently above $5 per gallon, and further oil price rises will create even greater pressure for businesses and consumers.

Market participants believe oil breaking $100 will significantly increase the political pressure on Trump to end the war and curb soaring energy costs. If oil stays high through late summer, renewed inflation expectations will also make the Federal Reserve's policy path more complicated, increasing the probability of interest rate hikes.

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