Yemen's Army Quits Bab el-Mandeb, Leaving Saudi Oil Route to Houthis

Yemen's Saudi-backed Southern Armed Forces said on Sunday, November 15, that they were pulling out of Dhubab airport and the area around Bab el-Mandeb. According to Reuters, the move marks the end of a six-week government counteroffensive.

The coast overlooking the southern gate to the Red Sea is back in Houthi hands. The Houthis sit just outside Tur al-Bahah, about 80 km from Aden. The news broke with markets closed and has not yet been priced.

Why the Government Forces Pulled Back

A Southern Armed Forces spokesman said the priority was securing the capital, Aden, and the neighboring governorates. The Houthis had seized the Red Sea coast in early September in a lightning advance.

The counteroffensive launched in October retook Dhubab but failed to take Mocha. The Houthi siege of Taiz and their advance north of Aden left the front exposed from behind.

Neither Saudi Arabia nor the Houthis responded immediately to the withdrawal. Over the same period, the Houthis stepped up strikes on Saudi airports, ports and Aramco facilities, including Yanbu on the Red Sea.

Saudi Oil's Route Around Hormuz

What lifts this beyond a Yemeni civil-war story is that the Iran war has constricted the Strait of Hormuz. Saudi Arabia now moves much of its exports by pipeline from its eastern fields to the western port of Yanbu.

Energy Minister Abdulaziz bin Salman said the line was pumping 5.8 million barrels a day on October 6. Its design capacity is 7 million barrels a day.

From Yanbu, tankers can also head north to Suez. But about 75% of Saudi crude is sold to Asia, and an Asia-bound tanker has to turn south through Bab el-Mandeb.

The market may read this withdrawal as a local military setback. But the retreating units held the shoreline of Saudi oil's backup route.

How Much Oil Is at Risk

For scale, EIA data show 4.2 million barrels a day of oil moved through Bab el-Mandeb in the first half of 2025. Hormuz carried almost 21 million barrels a day over the same period.

The EIA estimates that a simultaneous disruption of both straits could affect routes carrying about 24% of global oil supply. In normal times Bab el-Mandeb is a secondary route; with Hormuz constricted, it is the backup route itself.

The Houthis Have Not Closed the Strait

There is another side to the story. The Maritime Executive reports that the Houthis have not used their gains on the coast to shut general Red Sea traffic, and container lines have returned to the route.

The maritime blockade the Houthis declared in July targets Saudi Arabia, not general shipping. It is a declaration; what makes it enforceable is the coastal position and the ability to board ships from speedboats.

Brent settled between $95.84 and $96.08 on November 13, according to secondary reports, after falling 7% in a single day on Iran peace hopes on November 9. The market has known about the Houthi presence on the coast since September, and Iran diplomacy set the price.

What It Means for Investors

• The market had not priced the Houthi return to the coast at Friday's close; the first test is Brent futures' Sunday evening open, New York time.
• If oil rises, producers such as ExxonMobil and Chevron gain on revenue, while airlines and freight carriers face higher fuel costs.
• Higher oil feeds inflation expectations, reinforcing the Fed hike bets that pushed the 10-year yield above 5%.
• The risk that breaks this thesis is Iran diplomacy: if Hormuz reopens, Saudi dependence on Yanbu and Bab el-Mandeb falls quickly.

Oil volatility has spilled into equities in recent weeks; on November 9, the S&P 500 rose 2.35% as oil fell. The chart below shows the index over the last three months.

Sources: Details of the withdrawal come from Reuters via Al-Monitor, Al Jazeera and The National. Pipeline data come from the Saudi energy minister's October 6 remarks, and flow and Asia-share data from EIA figures cited by CFR. Kpler and ORF data and the Brent settlement come from secondary reports.