Oil passes $100 a barrel again and shares slide as Middle East conflict escalates

What Happened

Yemen’s Houthi militia (Ansar Allah) claimed responsibility for attacking two Saudi Arabian oil tankers—the Encelia and Layla—in the Red Sea on Thursday, using ballistic and cruise missiles as well as drones, which they said left one vessel on fire. The Houthis accused the crews of violating a naval blockade imposed by the group. The attack pushed the international benchmark Brent crude oil price back above $100 per barrel for the first time in two months, amid escalating US-Iran tensions over oil flows through the Strait of Hormuz. The price had previously peaked at $126 in April after US and Israeli airstrikes on Iran halted Gulf fossil fuel exports, falling back below $100 after hopes of a ceasefire, but it resurged following the collapse of a US-Iran memorandum of understanding and renewed hostilities.

Key Actors

Why It Matters

The spike in oil prices above $100 a barrel signals severe disruption to global energy markets, stemming from the intersection of Houthi attacks on Red Sea shipping and US-Iran brinkmanship over the Strait of Hormuz. It illustrates the economic leverage of Iran's regional proxies and the risk of a wider conflict that could further cripple critical maritime chokepoints, with knock-on effects for inflation and global economic stability.

Watch For

Monitor for verification of the tanker attacks and damage assessments; any military response by Saudi Arabia or the US; further Houthi threats or actions against Red Sea shipping; developments in US-Iran diplomatic backchannels or escalatory moves; and oil market reactions including potential strategic reserve releases.