Middle East war is spreading! Houthi armed forces "participate in the war", is the "second largest energy transit route" the Strait of Hormuz also in danger?

Houthi rebels officially enter the Iran war, global energy markets face new shockwaves. According to Xinhua News Agency, the Houthi rebels in Yemen stated on the 28th through their controlled Al Masirah TV channel that they had launched ballistic missiles towards Israel in the early morning of that day, and the action will continue until the aggression stops. This move signifies the opening of a new front in the war, with the southern end of the Red Sea and the Bab el Mandeb Strait once again exposed to risks. Saudi Arabia transports crude oil to Yanbu Port through the east-west pipeline, and then exports it through the Bab el Mandeb Strait, which is the core alternative for crude transportation after the Hormuz Strait was blocked. Since March, the daily loadings of crude oil at Yanbu Port have increased to about 3.4 million barrels per day, and since this week, some daily flows have exceeded 5 million barrels, setting a historical record. At the same time, Iran launched retaliatory strikes against Gulf Arab countries and Israel on Saturday. A fire broke out in the industrial area of Abu Dhabi in the UAE, Kuwait Airport's radar system was hit by drones, and the Salalah Port in Oman was forced to close. Expectations of a ceasefire in the short term have cooled, with Brent crude oil closing at $115 per barrel on Friday, representing an accumulated increase of about 60% since the outbreak of hostilities. Houthi rebels' entry raises risks in Bab el Mandeb Strait With the Houthi rebels joining the war, a highly sensitive energy geographical variable has been added to the conflict. The Bab el Mandeb Strait is a vital waterway connecting the Red Sea to the Gulf of Aden, alongside the Hormuz Strait as the two most crucial energy shipping passages in the world. Since the outbreak of the conflict in 2023 after the Haz war, the missile and drone attacks by the Houthi rebels have effectively blocked most Western shipping companies' passage through this waterway. This situation currently carries the risk of further deterioration. It is worth noting that Saudi Arabia is currently exporting oil through the Yanbu Port to bypass the nearly closed Hormuz Strait, and this port is completely within the range of Houthi rebel missiles. Bloomberg previously reported that the U.S. has issued warnings about potential Houthi attacks near the Bab el Mandeb Strait, with this risk continuing to rise with the escalation of the situation. This means that the alternative export route that Saudi Arabia has employed to cope with the closure of the Hormuz Strait is also facing direct threats. If Yanbu Port is attacked, another important safeguard line for global crude oil supply will be shaken, and the hoped-for "buffering solution" may fail. Hormuz situation remains unresolved, slow progress in negotiations The Hormuz Strait has been nearly closed since the U.S.-Israeli coalition launched airstrikes against Iran on February 28. Under normal circumstances, about a fifth of the world's oil and liquefied natural gas is transported through this waterway. Trump pushed for negotiations this week, extending the deadline for Tehran to reopen the Hormuz Strait to April 6 and proposing a package with 15 points, with core conditions including: Iran dismantling its nuclear facilities, reducing its missile inventory in exchange for sanctions relief. Iran rejected this proposal, insisting on war reparations, recognition of some form of control over the Hormuz Strait, and assurances from the U.S. and Israel to halt attacks on Iran. According to media reports citing informed sources, U.S. Secretary of State Marco Rubio stated in a Friday call with G7 colleagues that the war will end in weeks, not months. Trump's emissary Steve Witkoff also stated that the U.S. and Iran may hold a meeting "this week," with Pakistan being seen as the most likely location for negotiations. The foreign ministers of Saudi Arabia, Turkey, and Egypt are expected to visit Islamabad on March 29-30 to discuss regional de-escalation efforts. Rumors of ground invasion heat up, market sentiment continues to be under pressure By extending the deadline to April 6, Trump also bought more time for the U.S. to mobilize troops in the region, leading to increased speculation about ground deployment. According to media reports citing military analysts, if Trump decides to deploy ground forces, he may choose to capture the small area of Kharg Island in the Persian Gulf - where almost all of Iran's oil exports are shipped through. The U.S. may also seek to control the Iranian side of the Hormuz Strait to forcefully reopen this vital route for oil, gas, and container ships, or deploy special forces to transfer about 440 kilograms of highly enriched uranium from Iran. Financial markets have already reacted to the escalating situation: the U.S. stock market fell to a seven-month low on Friday, and the yield on U.S. 10-year Treasury bonds climbed to near the highest level since July. Fuel shortages continue to worsen in many parts of the world, with the Philippines declaring an energy state of emergency, and concerns about stagflation risks in the economic sector are also on the rise. Source: Wall Street Vision, Author: Yang Chen, GMTEight Editor: Chen Qiuda