Oil Prices Just Blasted Past $105 — And the Middle East Just Got a Whole Lot Worse

 Oil Prices Just Blasted Past $105 — And the Middle East Just Got a Whole Lot Worse

**Brent crude surged above $105 a barrel on Thursday after Iranian-backed Houthi rebels captured the strategic Yemeni port city of Mokha, giving them control over a second critical chokepoint for global oil supplies. The timing couldn't be worse for American consumers, who are already paying record prices at the pump.**

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## The Headline Numbers You Need to Know

Let me start with the numbers that matter, because they tell the story better than anything else.

**Brent crude**, the global benchmark, jumped more than 4% on Thursday to **$105.24 a barrel** — its highest level since May. **West Texas Intermediate**, the U.S. benchmark, climbed above **$100 a barrel** for the first time in months.

This isn't a blip. Oil prices are up **41% since the war began** on February 28. And they're now at levels that threaten to undo all the progress the Federal Reserve has made on inflation.

But the real story isn't just the price. It's *why* the price is going up — and what's happening on the ground in Yemen that has oil traders around the world hitting the panic button.

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## The Fall of Mokha: A New Front in the Oil War

On Thursday, September 10, 2026, Houthi rebels captured the Red Sea port city of **Mokha** after nine days of intense fighting with Yemeni government forces.

If you've never heard of Mokha, you're not alone. But here's why it matters: Mokha sits less than **50 miles from the Bab al-Mandeb Strait** — the "Gate of Tears" — one of the most important shipping chokepoints on the planet.

About **10% of global oil supplies** flow through Bab al-Mandeb. It's the southern outlet of the Red Sea, and it connects the Indian Ocean to the Suez Canal. Before the Iran war began, roughly 100 vessels passed through it daily.

Now, the Houthis control the coastline. And they're advancing toward the strait itself.

"The advance of the Houthi rebels, capturing key strategic locations such as Mokha and the Mayun Island in the Bab Al Mandeb strait, are frightening the oil market," said Sasha Foss, an energy analyst at CSC Commodities. "It imperils the flows in and out of the Red Sea at a time when the Strait of Hormuz is already partially blocked."

That's the key phrase: **already partially blocked**. The world is facing a double blockade.

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## The Double Chokepoint Crisis

Here's what makes this moment so dangerous. There are two critical chokepoints for Middle Eastern oil, and both are under threat.

### The Strait of Hormuz

The first is the **Strait of Hormuz**, between the Persian Gulf and the Gulf of Oman. Before the war, roughly **20% of global oil** flowed through this narrow waterway.

Since Iran effectively closed the strait, traffic has collapsed. In the week before fighting resumed on August 30, about **8 to 9 million barrels per day** flowed through Hormuz. More recently, that number has fallen **below 2 million barrels per day**.

That's a **75% reduction** in the world's most important oil chokepoint.

### The Bab al-Mandeb Strait

The second is **Bab al-Mandeb**. For months, Saudi Arabia has been using this route as an alternative — exporting its oil north through the Red Sea to bypass the closed Strait of Hormuz.

But now the Houthis are attacking Saudi tankers in the Red Sea. They've declared a "maritime embargo" against the kingdom. And with Mokha now under their control, they're in a position to choke off traffic through Bab al-Mandeb entirely.

The result is devastating for Saudi Arabia. The kingdom exported **3.2 million barrels per day in August**, down from **4.7 million barrels per day in July**, according to Kpler. That's a **32% drop** in just one month. Saudi oil exports are now at their lowest levels in at least 13 years.

"The threat is real, and that's why they keep shying away," said Peter Sand, a shipping analyst at Xeneta, describing shipowners' reluctance to operate in the southern Red Sea.

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## The Houthis' Strategy: Choking the Lifeblood of Global Trade

To understand why this matters so much, you need to understand what the Houthis are trying to do.

They're not just fighting a local war in Yemen. They're part of Iran's "Axis of Resistance" — a regional alliance that includes Hamas, Hezbollah, and various militias across the Middle East.

The Houthis entered the war alongside Iran on March 28. For months, they stayed relatively quiet. But in July, they declared a naval blockade against Saudi Arabia. In September, they escalated dramatically.

On September 8, they launched missile and drone attacks on Saudi Aramco facilities in Abha, Jizan, and Najran, wounding **73 people** and setting oil installations ablaze.

Now, they've captured Mokha and are advancing toward the Bab al-Mandeb Strait itself. Yemeni government forces and their allies are relocating south to Dhubab, which sits directly on the strait, across from the island of Perim. Control of Dhubab and Perim is key to controlling the strait.

The Houthis are also launching attacks on the strategic Hanish Islands, a volcanic archipelago in the Red Sea.

If they succeed in taking full control of Bab al-Mandeb, they'll be able to dictate terms to every ship that wants to pass through. And they've already shown they're willing to attack vessels that don't comply.

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## What This Means for Oil Prices

The market is now pricing in a scenario that was unthinkable just a few weeks ago: **both major Middle Eastern oil chokepoints could be closed simultaneously**.

"Market participants appear to be pricing in a more prolonged conflict in the Middle East as well as the risk that the latest escalation in military strikes disrupts oil flows from the Middle East," said Hamad Hussain, senior climate and commodities economist at Capital Economics.

The key risk, according to Hussain, is "whether the recent attacks on oil tankers lead to fewer ship-to-ship transfers taking place in the Gulf of Oman, which have so far played a key role in providing oil to global markets and keeping a lid on prices."

In other words: the workarounds that have kept oil flowing are starting to fail.

Goldman Sachs has warned that if the conflict continues to escalate, Brent could hit **$120 a barrel**. HSBC has raised its 2026 Brent forecast to **$90 a barrel** and its 2027 forecast to **$85**. The bank says the oil market is now "tighter for longer" and doesn't expect balance to return until mid-2027.

"We forecast Brent at USD 75/bbl in 2027 and USD 70/bbl in 2028," SEB Research said, reflecting a more optimistic scenario. But even that assumes the conflict de-escalates — which seems unlikely given the current trajectory.

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## The Human Cost: Record Gas Prices and a Squeezed Consumer

Here's what this means for you and your family.

**U.S. retail gasoline hit a record $4.15 over Labor Day weekend** — the highest price ever recorded for the holiday. Since the war began, gas prices have risen 39% nationally.

Diesel has been even worse. It hit an **all-time high of $5.90 a gallon** in early September. And diesel is the fuel that powers the trucks, trains, and ships that move everything you buy.

The inflation is already rippling through the economy. Consumers have spent an average of **$764.59 on fuel since the war began** — about **$418.82 more than they ordinarily would have**, according to Brown University's Watson School.

"The rise in energy prices threatens to stoke inflation more broadly, squeezing consumers and businesses," the New York Times reported.

And with winter approaching, there's no relief in sight for heating bills either.

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## The Fed's Dilemma: Inflation vs. Growth

This oil spike lands at the worst possible moment for the Federal Reserve.

The Fed has been trying to bring inflation down to its 2% target. It has kept interest rates elevated for years. And it was finally starting to see progress.

But oil at $105 a barrel threatens to undo all of that. Higher energy costs feed directly into consumer prices. And with inflation already running at **3.7% annually**, the Fed may be forced to keep rates higher for longer — or even raise them further.

Markets are now pricing in a **60% probability** of a rate hike at the Fed's September meeting. Investors are anxiously awaiting the U.S. inflation report due Friday, which could shape expectations for the Fed's decision.

"Investors are waiting for a crucial report on U.S. inflation, set for release on Friday, that could shape expectations for the Federal Reserve's decision on interest rates at its meeting next week," the New York Times noted.

That's the ugly reality: the Fed can't control oil prices, but it will have to respond to the inflation they create.

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## The Political Dimension: A War Without an End

President Trump made something clear on Wednesday night: **he expects the war to continue through the November midterm elections**.

He said he expects the war to end *after* the midterms. That means at least two more months of fighting — and potentially two more months of rising oil prices.

This is a political problem for the White House. Gas prices are one of the most visible and painful reminders of inflation. Every time an American fills up their tank, they're reminded of the war and its costs.

And the Houthis' success in Yemen — capturing Mokha, advancing toward Bab al-Mandeb — is a strategic setback for the U.S. and its allies. Iran's proxies are gaining ground, not losing it.

Pakistan has delivered a Saudi warning to Iran to rein in its Yemeni Houthi allies in an effort to prevent the crisis from spiraling. But the Iranians' response was telling: **"Iran does not control the Houthis."**

That's the problem with proxy wars. You can start them, but you can't always control where they go.

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## The Bottom Line: The World Is Running Out of Options

Here's the sobering reality: the world is running out of ways to move oil.

The Strait of Hormuz is effectively closed. The Bab al-Mandeb Strait is under threat. Pipelines that bypass these chokepoints have limited capacity. And the Houthis are showing no signs of backing down.

HSBC estimates that Gulf oil exports — from Saudi Arabia, the UAE, and other producers — have fallen to around **6 million barrels per day** from a pre-war level of 19-20 million barrels per day. Even with bypass pipelines increasing to 6.8 million barrels per day, the bank doesn't expect the market to rebalance until mid-2027.

"With Persian Gulf tensions showing no credible path to de-escalation," analysts at ING wrote, "if anything, current signals point to further escalation, keeping upside pressure firmly in place."

For American consumers, that means higher gas prices, higher heating bills, and higher costs for everything that gets shipped. For investors, it means volatility, uncertainty, and the risk that the AI-driven stock market rally could stall. And for the Fed, it means a much harder job at a time when it was hoping to declare victory over inflation.

The war began on February 28. It's now September 10. And there's no end in sight.

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## Frequently Asked Questions (FAQs)

### 1. How much did oil prices rise on September 10, 2026?

Brent crude surged more than 4% to **$105.24 a barrel**, its highest level since May. West Texas Intermediate climbed above **$100 a barrel**.

### 2. Why did oil prices spike?

Oil prices spiked because Houthi rebels captured the strategic Yemeni port city of **Mokha**, giving them greater control over the Bab al-Mandeb Strait — a critical chokepoint for global oil supplies. The capture threatens Saudi Arabia's alternative export route, which it has been using to bypass the closed Strait of Hormuz.

### 3. What is the Bab al-Mandeb Strait and why does it matter?

The Bab al-Mandeb Strait is a narrow waterway between Yemen and Djibouti that connects the Indian Ocean to the Red Sea and the Suez Canal. About **10% of global oil supplies** flow through it. The Houthis have declared a maritime blockade against Saudi Arabia and are attacking ships in the area.

### 4. How has this affected Saudi Arabia's oil exports?

Saudi Arabia exported **3.2 million barrels per day in August**, down from **4.7 million barrels per day in July** — a 32% drop. Saudi oil exports are now at their lowest levels in at least 13 years.

### 5. How high could oil prices go?

Goldman Sachs has warned that if the conflict continues to escalate, Brent could hit **$120 a barrel**. HSBC has raised its 2026 Brent forecast to **$90 a barrel** and says the market is "tighter for longer."

### 6. How does this affect American consumers?

U.S. retail gasoline hit a record **$4.15 over Labor Day weekend**. Diesel hit an all-time high of **$5.90 a gallon**. Consumers have spent an average of **$418.82 more on fuel since the war began** than they otherwise would have.

### 7. What does this mean for the Federal Reserve?

The oil spike threatens to stoke inflation more broadly, complicating the Fed's efforts to bring inflation down to its 2% target. Markets are now pricing in a **60% probability of a rate hike** at the Fed's September meeting.

### 8. Is there any sign of the conflict ending?

President Trump has said he expects the war to continue through the November midterm elections. There is no credible path to de-escalation currently visible, and Iran has said it does not control the Houthis, meaning it cannot easily rein them in.

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## Disclaimer

*This article is for informational and educational purposes only and does not constitute financial, investment, tax, or legal advice. The views expressed are based on publicly available information as of September 10, 2026. Oil prices, geopolitical situations, and market conditions are subject to rapid change. The author does not endorse any specific investment strategies or products. Past performance is not indicative of future results. Before making any financial or investment decisions based on the content of this article, please consult with qualified professionals who can evaluate your specific situation.*