Gulf Shipping Grinds to a Halt Following Houthi Missile Claim

The shipping industry suffered significant disruption on Wednesday as a Houthi claim of hitting a Saudi oil tanker in the Red Sea sent vessel traffic plummeting. On Wednesday, only two vessels navigated the Strait of Hormuz, a dramatic drop from 8 vessels on Tuesday, according to ship-tracking data analyzed by Reuters. At the Bab el-Mandeb Strait, the critical chokepoint linking the Red Sea to the Arabian Sea, the number of commodity vessels decreased to just one, compared to 20 on Tuesday, as cited by Kpler data in Reuters reports.

The Houthi group in Yemen, which aligns with Iran, announced a "precise hit" on a Saudi oil tanker named Wafaa north of the Red Sea off Yambu, using multiple ballistic missiles, according to a Houthi statement published by Al Bawaba. The Saudi-flagged products tanker NCC WAFA, which was last detected transmitting on July 19 while heading southbound in the Red Sea towards Bab el-Mandeb, is believed to have turned back north after Houthi threats were announced on July 22, potentially passing through Saudi coastal waters, where the reported missiles struck it far from the claimed blockade area.

Analysts at security and vessel-tracking firms have warned that shipping safety in the Gulf and Red Sea has reached its most perilous level since the onset of the Iran conflict. While the market holds cautious hopes that oil and gas flows could rebound as Iran and Oman seem to be nearing an agreement to jointly manage the Strait of Hormuz, with Iran's foreign ministry spokesman, Esmaeil Baghaei, stating the deal with Oman is "in the final stages."