Tankers are again turning away from the southern Red Sea, reversing a recovery in traffic following the 2023 disruptions. By early Thursday, the added war risk premium sent Brent crude to $98.70. Helima Croft, head of global commodity strategy at RBC Capital Markets, warned clients earlier today that "war enters a dangerous phase with the Red Sea and critical infrastructure at risk." With the Houthis indicating that they targeted two Saudi tankers in the Red Sea, we think a sustained deployment of force would cause a material reduction in total Red Sea oil flows. On Monday, Goldman commodities expert Daan Struyven warned that Brent crude futures could surge above $120 a barrel by the fourth quarter if disruptions in the Hormuz maritime chokepoint persist.