Houthi advance along the Red Sea coast is part of the biggest eruption of fighting in Yemen in years
Vessels at the Strait of Hormuz, as seen from Musandam, Oman, September 6, 2026. PHOTO: REUTERS
Middle East diplomacy appeared to falter heading into Monday with the postponement of a meeting between Iran and other Persian Gulf powers, while fresh attacks around the region’s two most important oil transit routes deepened concern over global energy supplies.
Oil prices jumped as markets reopened on Monday, following developments that threaten supplies from the world’s biggest exporter, Saudi Arabia, which kept a key 1,200-km (745-mile) east-west pipeline closed throughout the weekend after it was damaged in drone strikes on Friday.
Hopes for a diplomatic breakthrough in the near term faded when Oman’s foreign minister, Sayyid Badr Albusaidi, posted late Sunday that a regional meeting scheduled for Monday had been postponed “in the interests of consensus.”
Iranian officials had said they would attend that gathering with Gulf Arab states to present an agreement with Oman on governing shipping routes through the Strait of Hormuz.
Iran’s Fars news agency cited an Iranian foreign ministry official as saying that the Oman meeting was postponed at the request of some regional countries in a decision jointly made by Tehran and Muscat. The official said Iran would coordinate with Oman to determine a suitable date for holding the meeting.
Read: PM Shehbaz condemns Houthi attacks, vows efforts to defuse regional tensions in call with MBS
The postponement came on the heels of Saudi Arabia’s decision to shut down, at least for now, its pipeline that has served as the main route for Middle East oil bypassing the Strait of Hormuz.
Meanwhile, the strait continued to pose risks for oil shipping, with the British maritime security agency UKMTO saying on Sunday that a vessel had been struck by a projectile as it moved through the Strait of Hormuz, causing a fire and forcing the crew to be evacuated.
Iran, for its part, said one person was killed, and four crew were wounded aboard an Iranian commercial vessel struck off its coast.
US diesel hits another record
Oil prices surged above $100 last week for the first time since July. The politically sensitive retail price of diesel fuel in the United States rose on Sunday to another all-time high above $6.20 a gallon.
Traders and Saudi oil buyers told Reuters on Sunday that Riyadh has enough oil stored at its Red Sea port of Yanbu to maintain exports for just five to seven days if the pipeline struck on Friday remains shut.
After that, as much as 4% of global oil supply could be jeopardised, on top of the millions of barrels a day already lost to the disruption to traffic through the Strait of Hormuz.
Read more: Trump says US could stay in Iran and keep oil, like Venezuela deal
Saudi Arabia has not given full details of the extent of damage to its pipeline or said how long it will remain offline. Sources who spoke to Reuters have given conflicting estimates for the time needed to fix it, ranging from days to weeks. Satellite images have shown huge columns of smoke from locations along the pipeline.
The recent uptick in violence tied to the war that the United States and Israel launched six months ago follows a quiet August in which flows of Middle East oil had trickled back up.
In an interview with London-based pan-Arab news outlet Al-Arabi Al-Jadeed, Iran’s Foreign Minister Abbas Araqchi said that despite any agreement with Oman, Iran would not reopen the strait until the United States satisfies Tehran’s demands.
The US has so far failed to achieve the objectives President Donald Trump set out when he launched “Operation Epic Fury” in February: to end Iran’s nuclear programme, prevent it from being able to attack its neighbours and create conditions for its people to topple their rulers.
On a weekend trip to Ireland that included attending the Irish Open golf tournament, Trump reiterated that he still expected the Iran war to end this year, possibly just after US midterm elections in November, and then the price of gasoline would “drop like a rock”.
Houthi attacks continue
In Saudi Arabia, state media released video of damage to homes and a mosque from the latest purported cross-border attack by Yemen’s Iran-aligned Houthi rebels in Jazan province in the south. The Houthis claimed separately to have struck a Saudi military base in a neighbouring province following their capture of Perim Island in the Bab El-Mandeb, the “Gate of Tears” strait that controls the mouth of the Red Sea.
The Houthi advance along the Red Sea coast is part of the biggest eruption of fighting in Yemen in years.
Also read: Yemen’s Houthis claim ballistic missile, drone attack on Saudi military base
Their advance and their attacks on Saudi Arabia pose a new dilemma for Washington, which wants to support its Saudi allies and protect shipping but is wary of joining war on another front. The Houthi attacks have also left Gulf states with a difficult choice: accept growing economic pain or engage with Iran.
The United States bombed the Houthis for two months in 2025, but Trump halted that campaign after announcing the group had lifted a threat to attack Red Sea shipping.
Three sources told Reuters that Saudi Arabia’s de facto leader, Crown Prince Mohammed bin Salman, phoned Trump on Thursday asking for military aid to fight the Houthis, but was offered only intelligence support for now.
Trump acknowledged on Saturday that he had spoken to the crown prince, and said the Houthis had also phoned the US administration, asking Washington to keep out of the Yemen war.
Iran, UAE agree to strengthen ties, expand cooperation: Iranian president
Iran and the United Arab Emirates agreed to strengthen bilateral ties and expand cooperation, Iranian President Masoud Pezeshkian said Sunday.
He made the remarks in New Delhi after meeting with Abu Dhabi Crown Prince Khaled bin Mohamed bin Zayed Al Nahyan on the sidelines of the BRICS Summit.
“We agreed to move beyond the past and look to the future,” Pezeshkian said, adding the two sides sought a common understanding on building future cooperation.
The two leaders also discussed regional developments and efforts to ease tensions and strengthen stability in the region.
Their meeting came amid the ongoing US-Iran conflict, which began in February with US and Israeli strikes on Iran and has included attacks on Iranian military, energy and economic infrastructure as well as retaliatory Iranian strikes across the region.
Saudi pipeline outage threatens loss of 4% of global oil supply
Saudi Arabia will run out of oil stocks for exports if it doesn’t restart its major pipeline to the Red Sea within days, leading to a loss of up to 4% of global supply, Saudi oil buyers and traders said.
A further decline in Saudi flows will worsen the global supply crunch, which has already pushed global fuel prices to record highs, spurred inflation around the world and sent US bond yields to the highest levels since the 2008 financial crisis.
Since drone attacks forced Saudi Arabia to shut its huge east-west oil pipeline on Friday, Riyadh has not given full details about the extent of the damage or how long the route will stay offline.
Sources that spoke to Reuters gave varying estimates, with one saying the damage could take as long as five to six weeks to repair, while another said it could be fixed sooner and could resume pumping partially while repairs are ongoing.
Saudi Arabia’s government media office and energy ministry did not immediately respond to requests for comment. For the past six months, the pipeline running through the desert across the Arabian Peninsula has spared Saudi Arabia from the brunt of the impact of the wartime shutdown of the Strait of Hormuz that has crippled exports from its neighbours.
The world’s biggest exporter has used the pipeline to reroute around 4 million barrels per day — around 4% of global supply — to the port of Yanbu on the Red Sea. But with the pipeline out of service, Yanbu now has stocks to maintain exports for just five to seven days, according to three industry sources familiar with Saudi exports. Saudi Arabia also has stocks to supply customers for several days from Egypt’s ports of Ain Sukhna on the Red Sea and Sidi Kerir on the Mediterranean, a fourth source said.
Yanbu storage capacity stands at around 35 million barrels, according to industry estimates, with Ain Sukhna and Sidi Kerir able to store 18 million and 20 million barrels respectively. Stocks are not full and will ultimately run out without the east-west pipeline resuming operations, the four sources said.
Saudi oil supply has already fallen to a more than three-decade low in August on reduced flows via Hormuz and the Red Sea, the International Energy Agency said on Friday.
World oil supply will decline this year by 5.7 million bpd, or about 6%, the IEA, which coordinates Western energy policies, said. In addition to the attack on the pipeline, Houthi fighters in Yemen, who have threatened Saudi oil shipments, seized an island on Friday in the mouth of the Red Sea.
The Middle East supplied around 22 million barrels per day of oil before the war. Flows through the Strait of Hormuz have slowed to just 6 million to 9 million bpd, industry sources say.
Saudi Arabia told OPEC last week that its oil production had dropped to just 6.2 million bpd in August from 10.9 million bpd in February before the start of the war.
