Iran-backed Houthi forces seize strategic Yemeni port of Mokha
Capture of Mokha raises concerns over global trade and oil security near the Bab el-Mandeb Strait.
Quick Look
Iran-backed Houthi militants captured Yemen's strategic Red Sea port of Mokha, delivering a setback to Saudi-backed forces and heightening risks for global trade and oil transit near the Bab el-Mandeb Strait.
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Why It Matters
The Iran-backed Houthi militant group has been engaged in a conflict involving regional and international powers.
The Iran-backed Houthi militant group has seized control of Yemen's port city of Mokha on the Red Sea coast, bringing Tehran closer to securing another point of leverage in its six-month-long conflict with the U.S.
The Houthis' capture of Mokha is regarded as a severe setback to Saudi Arabia and the Yemeni forces it backs. It could also increase Iranian pressure around two critically important oil choke points on either side of the Arabian Peninsula: the Bab el-Mandeb Strait and the Strait of Hormuz.
The Houthis seized control of the city on Yemen's Red Sea coast on Thursday, according to The Associated Press, citing Yemeni and Houthi officials. CNBC could not independently confirm the report.
Mokha, a strategic city on Yemen's Red Sea coast that gave its name to Mocha coffee, is situated about 75 kilometers (46 miles) north of the Bab el-Mandeb Strait, a waterway that connects the Red Sea to the Gulf of Aden and to global markets.
The strategic importance of the Bab el-Mandeb Strait has grown significantly since the start of the U.S. and Israel's war against Iran in late February, with the waterway emerging as an alternative route for crude moving toward Asia.
It is now feared that the Houthis' advance toward the Bab el-Mandeb Strait could have major ramifications for global trade, particularly if the militant group ratchets up threats or attacks on Red Sea shipping.
The capture of Mokha represents a "major blow" to Saudi Arabia as it raises the possibility of the group exerting a tighter grip on the Bab el-Mandeb Strait, according to Hamish Kinnear, principal Middle East and North Africa analyst at risk intelligence company Verisk Maplecroft.
"The Houthis were already threatening Saudi shipping from previous positions, but their capture of Mocha opens up the possibility of further advances towards the Bab el-Mandeb coastline and a tighter grip on the chokepoint," Kinnear said in a research note.
Oil prices traded lower on Friday morning, but both major benchmarks remained on course to end the week above $100 per barrel for the first time since mid-May.
International benchmark Brent crude futures with November expiry traded 2.1% lower at $105.37 per barrel, while U.S. West Texas Intermediate futures with October expiry were last seen 1.7% lower at $100.76.
The resilience of the oil market is being tested by a clearer recognition of the mounting threat to regional supply, strategists at ING said, with energy market participants seen repricing both the duration and severity of the conflict.
Even as flows continue through the Strait of Hormuz, ING's strategists said flows remain well below pre-war levels, underlining how fragile the situation has become.
"Saudi energy infrastructure and crude oil exports from the Red Sea are increasingly at risk, with the Houthis in Yemen targeting Saudi Arabia," ING's Warren Patterson and Ewa Manthey said in a research note published Friday.
"As the Houthis have taken control of the Red Sea port of Mokha in Yemen, recent events increase the threat to shipping around the Bab al-Mandeb Strait," they added.
Open Questions
- Will the Houthis advance further toward the Bab el-Mandeb Strait?
- How will Saudi forces respond to the loss of Mokha?
