Iran's allies are choking off the last major route for Middle East oil, a dangerous escalation that threatens to spike gas prices and hammer the global economy.

• The Houthis say they are now blocking Saudi oil ships through the Bab al-Mandeb strait, cutting off 4.5 million barrels a day.
• With the Strait of Hormuz already blocked, this closes the last "pressure valve" that was keeping oil flowing during the US-Iran war.
• Saudi Arabia, which had stayed on the sidelines, is now pulled directly into the conflict.
• Both sides are hitting civilian targets — the US struck an Iranian water plant, Iran hit one in Kuwait, threatening Gulf cities that can't survive without them.
• Claims that Iran's military was "obliterated" are overblown; its missiles are buried deep in mountain bases and still firing steadily.

Outlook: If the blockade holds and talks fail, oil prices could hit worst-case levels within a month, with severe damage to the US, Europe, and Asia.