Trump Calls Off Yemen Airstrikes on Houthis

For investors, the immediate issue is not just the threat of renewed strikes, but the uncertainty around how far the U.S. will go to protect Gulf infrastructure and shipping lanes. The prospect of escalation has been a recurring support for crude prices and energy-linked equities, and the latest reports reinforce that channel even though prices were already retreating from recent highs.

U.S. crude futures were last around $92.44 a barrel, above the 50-day moving average of $88.04 but down from $105.83 earlier this month, showing the market is still pricing in a meaningful geopolitical risk premium. The energy sector ETF XLE slipped to $62.04, while the oil-and-gas exploration ETF XOP fell to $181.50, both below their recent peaks, indicating traders are balancing conflict risk against softer momentum in broader oil shares.

The backdrop remains tense. The Houthis have kept up missile and drone attacks on Saudi targets, including reported strikes around Riyadh and energy infrastructure, and the latest assault only deepens concern that the Red Sea and Gulf security environment could deteriorate further. Chevron and Exxon Mobil have both warned in recent filings that Middle East instability can affect operations, logistics and product prices.

Adalytica’s Global Stability Sentiment gauge showed neutral overall sentiment at 70, but awareness remained at “extreme fear,” underscoring how quickly markets can reprice when military action appears imminent. The next catalyst is whether Washington and Riyadh respond with tighter military coordination, or whether the last-minute cancellation signals a preference to avoid widening the conflict.