Global Markets Shaken as Houthi Strikes Escalate Middle East Conflict

​LONDON — Global financial markets tumbled on Monday as oil prices surged to their highest levels in years, fueled by a dangerous escalation in the Middle East. The entry of Yemen’s Houthi rebels into the ongoing Iran war has sparked intense fears of a broader regional conflagration and a potential direct ground intervention by United States forces.

​The latest market shock followed a weekend announcement by Houthi military spokesperson Yahya Saree, who confirmed the group had launched a “barrage of cruise missiles and drones” at strategic sites in Israel. This marks the first direct Houthi strike on Israel since the conflict began five weeks ago, signaling a coordinated offensive alongside Iran and Hezbollah.

​Oil Hits Multi-Year Highs

​Energy markets reacted sharply to the threat of supply chain paralysis. Brent crude surged over 3%, nearing $117 per barrel, while West Texas Intermediate (WTI) climbed past the $101 mark.

​Investor anxiety is centered on the two most critical maritime chokepoints in the world:

1.Strait of Hormuz: Currently under effective blockade by Tehran, cutting off 20% of global oil and gas transit.

2.Bab al-Mandeb: The Houthi-controlled gateway to the Red Sea, which handles roughly 12% of global trade.

​Saudi Arabia has already begun rerouting exports to Red Sea ports to bypass the Persian Gulf, but the Houthi strikes now put those alternative routes in the direct line of fire.

​Trump Eyes Iranian Oil Hub

​Adding to the geopolitical tension, U.S. President Donald Trump told the Financial Times that he is considering seizing Iran’s Kharg Island, the country’s primary oil export terminal.

​”Maybe we take Kharg Island, maybe we don’t. We have a lot of options,” Trump stated, suggesting the U.S. could take the facility “very easily” to control Iran’s oil revenue. While the Pentagon insists it seeks to avoid a full-scale invasion, reports indicate that 3,500 additional U.S. troops arrived in the region on Sunday, bringing the potential for specialized ground operations to the forefront.

ADVERTISEMENT

​In response, Iranian Parliament Speaker Mohammad Bagher Ghalibaf warned that any American boots on the ground would be “set on fire,” claiming Tehran is aware of “secret plans” for a U.S. land assault.

​Global Equities in Retreat

​The prospect of a “stagflationary” shock—rising inflation coupled with slowing growth—sent shockwaves through global exchanges:

1.Asia: Tokyo’s Nikkei 225 plummeted 2.8%, while Seoul and Hong Kong saw significant losses before a slight late-day recovery.

2.Wall Street: All three major U.S. indexes entered Monday on the back of a sharp sell-off following strikes on Iranian nuclear facilities.

​3.Europe: Markets remained volatile; while London’s FTSE 100 edged up slightly, Paris and Frankfurt trended lower as investors weighed the impact on energy-intensive industries.

​Analysts warn that the “risk-off” sentiment is unlikely to fade soon. “This is no longer just about the price of crude,” noted Skye Masters of National Australia Bank. “The focus is shifting to the global economic impact on fertilizers, petrochemicals, and metals.”

​While Pakistan has offered to broker “meaningful talks” to end the hostilities, the market remains skeptical. With a U.S.-imposed deadline of April 6 for a diplomatic breakthrough approaching, the world remains on edge.