Saudi Arabia is grappling with a complex web of threats from Iran and its regional allies, including Houthi rebels in Yemen and militias in Iraq, which have disrupted vital oil shipping lanes and complicated the kingdom's geopolitical standing. These developments have raised concerns for global markets and underscored the unpredictable nature of U.S. support.
Houthi rebels have advanced toward the Bab el-Mandeb Strait, a crucial chokepoint for Red Sea shipping, and have seized territory including the port city of Mokha and a Red Sea island. Concurrently, drone attacks attributed to Iran-backed militias in Iraq have forced Saudi Arabia to shut down a major oil pipeline that transported crude from eastern fields to the Red Sea coast.
These disruptions have significantly impacted Saudi oil exports. Figures from Kpler, a global trade monitor, show a sharp decline in exports to Asia, from approximately 3.4 million barrels per day in June to 128,000 in August, with a partial recovery to 700,000 barrels per day in September.
The kingdom's most essential ally, the United States, has displayed an unpredictable posture. Former U.S. Ambassador to Saudi Arabia Michael Ratney described the situation as "incredibly frustrating" for the kingdom, noting that while Saudi Arabia has "great trepidation" about the conflict, its worst-case scenarios are unfolding. A Saudi official, speaking anonymously, stated the kingdom would defend itself and collaborate with partners, including the U.S., to ensure maritime navigation freedom.
Saudi Arabia's Crown Prince Mohammed bin Salman has pursued ambitious social and economic reforms aimed at transforming the kingdom into a global business hub. These modernization efforts have been overshadowed by regional instability, particularly following the Oct. 7, 2023, attack on Israel, which triggered retaliatory actions. An alleged U.S. and Israeli attack on Iran on Feb. 28 was followed by missile and drone strikes attributed to Iran on Saudi Arabia and other Gulf states, impacting oil exports through the Strait of Hormuz.
Saudi Arabia had previously mitigated some of these risks by piping oil across the peninsula to the Red Sea for export via Egypt's SUMED pipeline and the Suez Canal, or toward the Indian Ocean through the Bab el-Mandeb Strait. However, renewed Houthi actions since July have intensified the pressure.
The kingdom's options for response are limited and carry significant costs. A renewed military escalation against the Houthis could prolong the conflict and lead to more attacks on Saudi energy infrastructure. Experts note that Houthi weaponry has become more sophisticated, and Saudi Arabia may have fewer interceptor missiles available due to the U.S.-Iran conflict.
A diplomatic solution is also challenging. The Houthis demand the lifting of a Saudi-led blockade, which would empower them long-term, while Iran reportedly shows little interest in regional stability without securing major concessions from the U.S.
For decades, Saudi Arabia and other Gulf states have relied on U.S. security guarantees, which have reportedly eroded. During his presidency, Donald Trump did not significantly intervene after a 2019 attack that disrupted half of Saudi Arabia's oil supply. In February, the U.S. attacked Iran without consulting its Gulf allies and has since struggled to defend them.
Trump has previously launched air campaigns against the Houthis but has expressed reluctance to escalate military pressure, citing upcoming elections. He indicated to Fox News that his decision on increasing military action might be influenced by the election cycle. Ratney suggested that Saudi Arabia would find it difficult to achieve its objectives without consistent U.S. support, which the White House is reportedly not enthusiastic about providing.