Oil prices edged lower on Thursday even as Iran reportedly urged Yemen’s Houthi movement to prepare for closing the Red Sea to oil transit, according to Ship & Bunker. The move would come in retaliation for continued U.S. bombing of Iran, but markets did not react with the alarm some analysts expected.
Brent crude settled down 72 cents, or about 0.9 percent, to $84.23 per barrel, while West Texas Intermediate fell 65 cents, or 0.8 percent, to $78.95 per barrel, Ship & Bunker reported.
Analysts Point to Short Covering
Ed Hayden-Briffett, oil research analyst for The Officials, told Ship & Bunker that heavy short positioning earlier in the week had contributed to the pullback. He noted that investors who had been burned by a prior rally began cutting their short positions as the situation appeared to stabilize somewhat.
Still, concern persists over the possibility of Iran’s two primary oil export corridors being disrupted simultaneously. According to Ship & Bunker, the Houthis have reportedly threatened to shut the Bab el-Mandeb gateway if the U.S. strikes Iranian power infrastructure. Alex Hodes, director of energy market strategy at StoneX, was quoted as saying this raises “the serious risk of both of the Middle East’s primary oil export routes being disrupted at the same time.” Wael Makarem, financial markets strategist lead at Exness, echoed this concern, stating that a Bab el-Mandeb closure “would significantly amplify supply chain stress.”
However, Edmund Fitton-Brown, a former British ambassador to Yemen and senior fellow at the Foundation for Defense of Democracies, cautioned that such a closure would likely provoke “international anger” and could trigger Israeli and U.S. strikes on Sana’a and Hodeida, Ship & Bunker reported.
Diverging Price Forecasts
Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, said that while a full-scale war remains unlikely amid ongoing mediation efforts, WTI could still climb to $85–$87 depending on how the conflict progresses, according to Ship & Bunker. Goldman Sachs reportedly offered a wider range, suggesting Brent could exceed $110 in the fourth quarter if Gulf export disruptions persist, or fall into the $60s by year-end should tensions ease.
Separately, Ship & Bunker reported that Chevron is preparing to sign memoranda of understanding advancing its involvement in Iraq’s West Qurna 2 oilfield and the Nassiriya project, while also working with Iraq on technical studies for new export pipelines that would bypass the Strait of Hormuz entirely.
Does This Matter to You?
Continued volatility around the Bab el-Mandeb and Strait of Hormuz corridors remains a key watchpoint for vessel operators, charterers, and bunker traders monitoring freight and fuel cost exposure in the region. Any disruption to these chokepoints could affect voyage planning, insurance considerations, and bunker pricing across major trade lanes. As the source material notes, forecasts remain divided, with outcomes ranging from sharp price spikes to significant declines depending on how the conflict develops.
Gulf Bunkering does not provide operational or security guidance. This article is for informational purposes only. Operators should consult flag state authorities, P&I clubs, and relevant advisories for decisions relating to transit planning.
Sources: Ship & Bunker
