Houthi Red Sea risk still shadows insurers
War-risk insurance for Saudi-linked Red Sea tankers has roughly tripled while Houthi threats persist. Brokers now quote about 3% of vessel value near Yanbu, which keeps many ships on longer Cape routes.
War-risk insurance for Saudi-linked Red Sea tankers has roughly tripled as Houthi threats persist. Brokers quote about 3% of vessel value near Yanbu, keeping many ships on longer Cape detours.
As of late September 2026, London marine brokers told Reuters that quoted war-risk premiums for Saudi-linked tankers calling at Yanbu — Saudi Arabia's main Red Sea oil port — have risen to around 3% of a vessel's value, up from less than 1% in early July. For ports farther south, including Jizan near the Yemen border, quotes can climb as high as 7%, nearly matching Hormuz ranges of 6% to 9%. Tankers without a Saudi connection typically still pay roughly 0.2% to 0.3% for Red Sea transit.
Those quotes matter because seven-day war-risk cover is reviewed daily. Industry sources told Reuters a Yanbu voyage can now cost about $3 million in war-risk premium alone, versus at least $100,000 before the latest regional war — and roughly $7 million from more southerly Saudi ports or via Hormuz. Saudi Arabia had used its East-West pipeline to move about 4 million barrels per day — roughly 4% of global supply — to the Red Sea after Iran constrained Gulf exports through Hormuz. The kingdom shut that pipeline on September 11 after drone attacks it blamed on Iraq-based militias; Yanbu loadings had yet to fully resume when Reuters published on September 24.
The pricing spike traces to a July escalation. On July 20, Yemen's Iran-aligned Houthis declared a maritime embargo on Saudi ports and Saudi-linked shipping near Bab el-Mandeb. BBC Verify tracked at least seven oil tankers making sharp U-turns close to Yemen, and the New York Post flagged Saudi crude carriers Rodos and Xin Long Yang reversing rather than exit south with a combined 2.7 million barrels. Al Jazeera, citing S&P Global and Marsh, reported Bab el-Mandeb crossings falling sharply as underwriters repriced Red Sea risk within days. London's Joint War Committee later widened its high-risk zone north toward Jizan.
History underpins that speed. From late 2023 through 2025, Houthi attacks on commercial shipping sank four ships, seized one vessel, and killed nine crew, according to BBC reporting. Nearly 15% of global sea trade moves through the Red Sea corridor linking Suez and Bab el-Mandeb; when that lane tightens, Asia-bound Saudi crude often faces weeks added via the Cape of Good Hope.
Security cover is uneven across the two chokepoints. U.S. forces have provided some aerial support for Hormuz traffic; no equivalent U.S. umbrella covers the Red Sea, where the EU's Aspides mission says it needs more ships. Saudi Arabia's crown prince sought U.S. help against the Houthis, and Riyadh appointed Saudi Reinsurance Company to lead a domestic marine war-risk pool. Dryad Global still counted only a handful of tankers a day through Bab el-Mandeb, mostly without Saudi affiliations.
Watch next: Joint War Committee listed-area notices via the Lloyd's Market Association; UK Maritime Trade Operations advisories; EU Aspides routing guidance; and official Saudi and Houthi statements on port access.
Where outlets agree Reuters, BBC, and Al Jazeera agree that Houthi threats have elevated Red Sea war-risk insurance and pushed Saudi-linked tankers onto costlier diversions.
Where they differ Washington Examiner and the New York Post frame the file around Iran-backed Houthi pressure on a second oil chokepoint and Saudi export exposure; BBC and Al Jazeera focus more on vessel U-turns, diversion costs, and how quickly insurance markets reprice crew and cargo risk.