Saudi shutdown of key pipeline limits oil flow as Yemen hits back against Houthis

Saudi Arabia has closed a critical oil pipeline after it was struck by drones launched from Iraq, the latest squeeze on Middle Eastern supplies after attacks by Iran-backed Houthi rebels this week threatened to deepen the world’s energy crisis.

The 745-mile pipeline had helped Saudi Arabia, the world’s largest crude oil exporter, bypass the blocked Strait of Hormuz, through which some 20% of the world’s oil used to pass before the U.S. and Israel waged war on Iran in late February.

The Saudi Energy Ministry confirmed the shutdown of the East-West pipeline on Friday, adding that drone attacks had resulted in a number of injuries and that its teams were “taking the necessary measures to secure the pipeline and assess its safety.”

Saudi Arabia said it would not retaliate for now following a request from Iraq’s prime minister, while reserving the right to take all necessary measures to protect its sovereignty, security and critical facilities, according to a Saudi foreign ministry statement.

The pipeline has been moving 4-5% of global oil supplies, new agency Reuters reported Friday.

An Iraqi military commander was dismissed early on Saturday after investigations confirmed the latest drone attacks targeting Saudi Arabia originated from Iraq, according to a statement by Iraq‘s prime minister’s office.

Iraq also closed two key border crossings with Iran, Iraq’s state-run news agency reported Saturday.

Kuwait, a U.S. ally in the region, warned that the pipeline attack was a “dangerous escalation that undermines the security and stability of the region,” while Bahrain stressed Saudi Arabia’s right to “take all necessary measures to protect its sovereignty.”

U.S. President Donald Trump said on ⁠Saturday that everything would “work out just ⁠fine” when asked about the region on a visit to Ireland. He also said, without providing evidence, that Iran was “probably” behind the pipeline attack.

The pipeline strikes came as rebel Houthi forcesin Yemencaptured Perim, an island in the middle of the vital Bab el Mandeb Strait, which serves as a gateway to the Red Sea trade route that links Europe and Asia.

The Houthis also captured the historic port city of Mocha this week, followed by an advance on the strategic coastal town of Dhubab and the apparent withdrawal of forces from the Saudi-backed, internationally recognized Yemeni government from Perim, also known as Mayun.

If the Houthis are able to threaten shipping along the Bab el Mandeb Strait, it could reduce oil supplies through another key waterway. Saudi Arabia has had to rely on the Red Sea route given the disruption to the Strait of Hormuz.

Yemeni Ministry of Defense said Saturday it had carried out counterattacks against Houthi targets, hitting militants, vehicles and weaponry.

A statement issued by Houthi forces on Friday said that “maritime navigation is safe for all companies except for Saudi vessels,” vowing to strike Saudi targets “until the aggression stops and the blockade against our dear people is lifted.”

Trump said the Houthis had contacted the U.S. to stress that they “don’t want to fight with us” and would “much prefer not having us involved.”

Oil prices ended the week above $100 a barrel for the first time since Mid-May after the dramatic developments.

Effective Houthi control over the Red Sea coast “is a game changer,” and could give Iran powerful new leverage in its war with the United States, Fawaz Gerges, a professor of international relations at the London School of Economics, told NBC News.

He said: “Far from being really besieged and bleeding, Iran now could easily increase the pain to the U.S. economy and the world economy.”

Gerges said it remains to be seen whether the Houthis can maintain their control of the vast areas of the Red Coast, or if they “overextended themselves.”

But the Trump administration “now finds itself in a much more difficult position because it gambled that the blockade of Iran would force Iran to accept Trump’s conditions,” he added. “The reverse has happened.”

Iran President Masoud Pezeshkian said Saturday that it would sign an agreement with Oman over a joint route through the Strait of Hormuz on Monday, as part of a deal securing future navigation rights through the strait.

That deal is not expected to immediately reopen the waterway without a broader agreement with the U.S., Iran has previously stressed.

The U.S. military is helping its Saudi counterparts to develop and coordinate targets inside Yemen, according to a U.S. official and a person familiar with the matter, after Saudi Arabia vowed a firm response to hostilities.

Saudi Crown Prince Mohammad bin Salman is urging President Donald Trump to take military action against the Houthis, according to a person familiar with the matter. The president and the Crown Prince have discussed the recent escalation by the Houthis at least twice in the last 24 hours, this person said Friday.

The United Nations’ International Organization for Migration warned on Friday at least 46,000 people have so far been displaced in Yemen since fighting escalated last week.

It said that figure spanned the West Coast and Taiz governorates as of Thursday, with the numbers of those displaced “alarmingly rising by the hour.”

The organization called on all parties to the conflict to “guarantee safe humanitarian access and to protect civilians, aid workers and assets on the ground.”

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