Deepest Houthi strike yet hits Saudi Arabia

Yemen's Tehran-backed Houthis attacked four cities in the south of U.S. ally Saudi Arabia on Tuesday, wounding more than 70 people and setting oil installations ablaze in what appeared to be a major expansion of the six-month-old Middle East war.

The Houthis, who control most of Yemen's populated areas including the capital, said they had launched a broad operation deep into Saudi territory. They used drones and missiles to strike a Saudi airbase in the southern city of Khamis Mushait, and targets belonging to Saudi Arabia's state oil company in nearby Abha, Najran on the Yemeni border, and Jazan, a major Red Sea port city that houses a large refinery and power plant.

NASA satellite images showed a thick cloud of black smoke over the Jazan refinery and a column of white smoke rising from an oil distribution centre in Abha.

Saudi authorities described blazes at the sites and said women and children were among the 73 people hurt. The reports of such large numbers of wounded suggested the attacks were among the biggest carried out against Saudi Arabia since the United States and Israel launched their war against Iran in February.

No confirmed images from the ground of the aftermath of the attacks on Saudi cities were available and witnesses could not be reached in a country where media is tightly controlled. The Houthis released pictures of explosions of what they said were trucks from Saudi Arabia they had hit in separate strikes at the border in another area the previous day.

Houthi-controlled media reported later on Tuesday that Saudi warplanes had carried out airstrikes in Yemen's Jubah district east of the capital Sanaa and Taiz province in the southwest.

FIGHTING DRIVES UP OIL PRICES

After a month of calm in August, fighting in the Gulf has resumed, with Iran and the U.S. exchanging fire, sending global oil prices back towards the $100 a barrel level surpassed at the war's peak. Brent crude reached $99.46 on Tuesday, the highest since July 24, and U.S. WTI crude hit its highest level since June 8. Both benchmarks eased a bit by afternoon in Europe but were still up on the day.

Houthi attacks on southwestern Saudi Arabia have the potential to worsen the war's global economic impact by disrupting Middle East energy supplies beyond the blockaded Strait of Hormuz.

Saudi Arabia has led an Arab coalition battling against the Houthis in Yemen for more than a decade. That war had calmed in recent years, but a ceasefire there has broken down, with the Houthis threatening shipping at the mouth of the Red Sea.

In recent days, Saudi-backed Yemeni forces of a government based in the south have launched a multi-pronged offensive on Houthi-held areas, after the Houthis tried to advance on government-held positions. The government, which was driven by the Houthis from the capital 12 years ago, says it now aims to recapture all Houthi-held territory. 

The International Organization for Migration said more than 18,500 people had fled their homes because of fighting along Yemen's west coast over the past three days.

'MARITIME EXCLUSION ZONE'

"The coalition will take all necessary operational measures to deter this terrorist militia and resolutely confronts its hostile approach," Turki al-Malki, spokesperson for the Saudi-led coalition, said in a statement on X.

Houthi spokesperson Yahya Saree accused Riyadh of having escalated the war by launching airstrikes on Yemen, and said the Houthis would respond.

The wider war in the Gulf has turned into a test of wills between the U.S. and Iran, with each side hoping that economic pressure from competing blockades will force the other to yield.

The U.S. Treasury announced new aviation-related sanctions on Tuesday it said were aimed at grounding Iran's airlines.

Washington is trying to increase the flow of oil to world markets by guiding ships through the Strait of Hormuz, while cutting off Iran's exports with a blockade.

Tehran has announced new measures to seal off the strait, saying it will soon unveil details of a "maritime exclusion zone" that will extend from the perimeter of the U.S. blockade, through the strait and into the Gulf itself.

Washington fired at Iranian tankers over the weekend in retaliation for Iranian fire at U.S. warships, in which Iran said it had used new, more capable ballistic missiles.

The navy of Iran's Revolutionary Guards said on Tuesday it had captured an unmanned U.S. submersible at the mouth of the strait. There was no immediate confirmation from Washington.

Despite U.S. strikes that have degraded Iran's conventional forces and punished its economy, Iran's missiles and drones can still reach U.S. military bases in the region and hit ships in the strait that previously carried a fifth of global oil.

The fighting has caused global shortages of crude oil and the fuels produced by refining it. Diesel fuel in the United States is now at a record average retail price of more than $5.90 a gallon, harming the political prospects of President Donald Trump's Republicans. 

"Oil prices will drop precipitously, like everything else is dropping (but more!), when we WIN the war with Iran. Three Dollars a gallon, but ultimately, below Two Dollars a gallon. It will all happen quickly, and Iran will never have a Nuclear Weapon," Trump said on social media.