Brent Crude Surges Above $100: The Dual-Chokepoint Crisis in the Red Sea and Strait of Hormuz

Brent crude surged past $100 per barrel on July 23, 2026, after Iran-backed Houthi forces attacked two Saudi oil tankers in the Red Sea, adding a second major chokepoint threat to an already-disrupted Strait of Hormuz. Prices retreated approximately 4% on July 24 after the Houthis signaled they would not impose a full blockade, but analysts at Goldman Sachs and Barclays see material upside risk above $120 if disruptions persist.

The Surge to $100: Direct Trigger

On July 23, Houthi militants in Yemen said they had attacked two Saudi-flagged oil tankers — the Encelia and the Layla, a Very Large Crude Carrier — in the Red Sea using drones and missiles . The next day, Brent futures settled at $100.65 per barrel, a 6.96% single-day jump — the highest since late May . The attack opened what Bloomberg called "a new front in a conflict that had already shut down most traffic through the Strait of Hormuz" .

The Houthis had declared a naval blockade on Saudi Arabia on July 21, and the July 23 strikes were the first reported enforcement action under that declaration .

The Dual-Chokepoint Mechanism

• Strait of Hormuz — already largely closed. Before the Houthi attacks, the US-Iran conflict had reduced Persian Gulf oil flows through the Strait of Hormuz to below 45% of pre-war levels, effectively "near-halting" trade through the world's most important oil chokepoint . Goldman Sachs analysts estimated that pre-war flows through Hormuz had been slashed to below 45% of normal levels .

• Bab el-Mandeb / Red Sea — now under threat. The Houthi tanker strikes threatened the Bab el-Mandeb Strait, the southern entrance to the Red Sea and the alternative maritime route for oil shipments that had been diverted away from Hormuz . With both chokepoints under threat, the market priced in a scenario in which no viable maritime route remained for Middle Eastern crude exports.

• The dual-closure eliminated the fallback routing: crude that had been rerouted via the Red Sea to avoid Hormuz was now itself at risk, creating a "squeeze" on global supply . India, which depends on the Bab el-Mandeb for more than 50% of its crude imports, saw its equity markets fall in early Friday trading as the shock spread .

The attacks effectively broke the reroute trade that had been a safety valve during the Hormuz disruptions, removing the last practical maritime route for Saudi exports .

Why Prices Retreated on July 24

On July 24–25, Houthi rebels signaled they would not completely block ship traffic through the Bab el-Mandeb Strait, walking back the prospect of a full Red Sea closure . Houthi spokesman and chief negotiator Mohammed Abdulsalam stressed that "ship traffic through the strategic Bab el-Mandeb Strait has not been blocked" and that "there will be no full closure, as some have suggested" . This de-escalation signal triggered a sharp reversal:

• Brent fell roughly 4% on Friday, July 24, settling near $97 per barrel — its biggest one-day drop since late June .
• Oil was still observed traversing Middle East trade routes despite the escalation, which further eased panic pricing .
• Two Chinese supertankers carrying a combined 4 million barrels of Saudi Arabian oil managed to exit the Red Sea via the Bab el-Mandeb Strait on Thursday, demonstrating that the route remained partially open .

The New York Times reported prices "remained close to $100" rather than decisively above it, as Iran also dismissed a US cease-fire proposal that same day .

Analyst Projections for Further Upside Risk

Source	Scenario	Forecast
Goldman Sachs	If Hormuz disruptions persist through Q4 2026	Brent could top $120/barrel by Q4 2026
Goldman Sachs	If Hormuz stays disrupted through 2027	Brent would average $100 next year
Barclays	If Hormuz impasse lasts 1 more month	+$2/bbl upside to $96 forecast
Barclays	If Hormuz impasse lasts 2 more months	+$7/bbl upside to $96 forecast
Barclays	If Hormuz impasse lasts 3 more months	+$10/bbl upside to $96 forecast
S&P Global	Dual-chokepoint closure	"Materially higher" supply-risk premium already baked in
JP Morgan	If disruption persists another full month	Could reach $120–$130 in near term, worst-case $150

Key caveat: Goldman's base case remains $80 per barrel; the $120+ scenario is not their central forecast but their "risk scenario" . Barclays explicitly said risks are "skewed higher depending on how long the impasse lasts" . Goldman's base case assumes de-escalation in the Middle East, with Brent at $80 in Q4 2026 and $75 in 2027 .

The market remains acutely sensitive to any further escalation — or de-escalation — on either chokepoint. The events of late July 2026 demonstrated how quickly a second chokepoint threat can transform a supply disruption into a full-blown global oil shock.