Houthi ban on shipping may disrupt Saudi steel imports
The Yemeni Houthi rebel group said on July 20 that it was imposing a ban on Saudi-related maritime navigation, calling the move a response to the kingdom's ongoing blockade of Yemen and military aggression against the country. This move could jeopardize not only the export of crude oil from Saudi Arabia's Yanbu terminal on the Red Sea, but also the supply of steel to the kingdom.
The immediate risk appears to be higher for ships heading to Saudi Arabia's Red Sea ports from Asia through the Bab el-Mandeb Strait, while cargo arriving at ports such as Jeddah or King Abdullah Port from the Mediterranean Sea through the Suez Canal will bypass the Bab el-Mandeb area.
El Mandeb, and this may lead to a reduction in operational risk, unless the Houthis try to make more extensive use of the ports of Saudi Arabia.
"I assume that the situation will worsen and definitely affect shipping costs, because ships will have to go around the whole of Africa, especially considering the impact on the Strait of Hormuz," the trader said. "Let's see what happens in the next few days. Only the gates to Europe will remain open."
The Houthi group said in a statement that the measure would take effect immediately under the "siege for siege" formula. He also warned of further escalation if Saudi Arabia takes additional military steps and called for continued mobilization across Yemen.
According to the Global Trade Tracker (GTT), Saudi Arabia imported about 3.1 million tons of steel products in the first quarter of 2026, compared with 3.8 million tons a year earlier.
China was the largest supplier of steel products to Saudi Arabia in the first quarter, shipping about 1.2 million tons, according to GTT data. This included 667,000 tons of hot-rolled steel, 21,000 tons of cold-rolled steel, 140,000 tons of hot-dip galvanized steel, 132,000 tons of semi-finished products, including slabs and billets, as well as other steel products.
Thus, any violation of navigation in the Red Sea may complicate the arrival of flat rolled products, semi-finished products and other steel cargoes.
At least two shipments of steel from China are currently en route to the Red Sea coast of Saudi Arabia and have not yet crossed the Bab al-Mandeb. The 55,561-ton Better Victory ship transports steel from Tangshan to King Abdullah Port, while the 56,860-tonne Dato Success7:17 ship departs from Kaofeidian to the same port, according to data analysis company Kpler. None of the ships showed signs that they were going to turn around.
Several tanker owners have already been preparing for a possible escalation, as the Houthis have been using the "siege" rhetoric for some time.