Houthi militants struck two Saudi tankers in the Red Sea on Wednesday, the first direct hits on oil vessels in the current conflict, sending Brent crude to a six-week high near $96. The attacks — and a subsequent Houthi declaration of a maritime embargo on Saudi-linked shipping — have pushed oil up more than 10% this week alone, following last week's 17.35% surge. For crypto traders already nervous about inflation, the question is how high oil can go before it starts dragging down risk assets.
What happened in the Red Sea
Houthi forces hit two Saudi tankers with missiles and drones on Wednesday, according to reports. Three crude carriers bound for Asia reversed course after the Houthis announced a maritime embargo on Saudi-linked vessels. The Bab el-Mandeb strait — a chokepoint that handled about 5.4 million barrels of oil per day in the first quarter, per the US Energy Information Administration — is now effectively contested. Saudi Aramco is rerouting its oil, offering cargoes from Egypt's Mediterranean coast instead of sailing past Yemen.
Brent's technical picture
Brent rose 1.8% to $95.70 on Thursday, its fifth consecutive daily gain. It's climbed almost 30% over the past month and 38% year over year. The rally broke above the $92 resistance zone that had rejected prices several times since 2023. The next big test is at the 0.618 Fibonacci retracement of $100.64, which coincides with the psychological $100 mark. A daily close above that could open the way to the swing high at $119.50. On the downside, first support sits at $94.82, with the $92 zone below; a drop under $92 would invalidate the bullish outlook.
Geopolitical tinderbox
The tanker strikes are just one front. US forces have struck Iranian targets for a 12th consecutive day. President Donald Trump warned Washington would hit Iranian infrastructure if Tehran attacked ships in Hormuz. Iran threatened retaliation against US-linked energy assets. Both sides played down ceasefire prospects. Meanwhile, the Caspian Pipeline Consortium halted intake from Kazakhstan after drone attacks near its Black Sea terminal. The EIA reported a surprise 1.4 million barrel build in US crude stocks, but that did little to cool the rally.
A broader blockade of Bab el-Mandeb would force vessels around southern Africa, lifting freight and insurance costs — and pushing Brent above $100, according to the facts. That kind of oil spike feeds inflationary pressure, which historically weighs on crypto markets as rate-hike expectations rise. A lasting truce could unwind the war premium, but nothing in the current picture suggests one is coming. For now, the decisive test is at $100.64. If Brent breaks through, crypto traders should watch for a risk-off shift.
