Yemen’s Iran-aligned Houthis on Friday reached the strategic island of Perim in the Bab el-Mandeb Strait, four Yemeni government sources told Reuters, potentially tightening ‌their grip on one of the world’s vital shipping routes and further increasing the threat to energy markets in the widening Middle East war.

Earlier, two sources from the Saudi-backed, internationally recognised Yemeni government said its forces had withdrawn from Perim and that the Houthis had also taken the mainland Red Sea coastal town of Dhubab, which faces the island.

If the Houthis gain full control of the Bab el-Mandeb Strait, on the opposite ​side of the Arabian Peninsula from the Strait of Hormuz, it could give their backer Iran a critical advantage in the war with the US, reducing supplies ​through a second major transit corridor and sending oil prices surging.

Saudi Arabia, the world’s largest oil exporter, has relied on the Red Sea route since the Iran conflict effectively closed Hormuz, through which a fifth of global oil used to flow.

Global oil prices were on track to end the week above $100 a barrel for the first ​time since mid-May, though they were slightly lower on Friday after the Financial Times reported that foreign ministers in the Middle East were trying to work out a temporary deal to manage ​shipping through the Strait of Hormuz.

Reuters could not immediately verify that report.

Yemeni Government Forces Plot Counter-Offensive

Yemeni government forces, meanwhile, indicated they would try to retake areas captured by the Houthi militants in their lightning offensive this week along the Red Sea coastline.

They announced they would deploy weapons and aircraft to eliminate any movement of the “terrorist” Houthi militias in strategic areas, including the road leading to the coastal city of Mocha, which the ​militant group captured on Thursday along with the Red Sea islands of Hanish.

Military spokesman Colonel Majed al-Nazili called on civilians to avoid using the route between the city of Taiz and ​Mocha and steer clear of equipment belonging to the Houthis, mountain fighters who withstood years of devastating Saudi air strikes during Yemen’s civil war.

Fighting between the Houthis and the Yemeni government forces has intensified in ‌recent days, ⁠with the Iran-aligned group shifting its focus to control over Yemen’s long coastline instead of just the north and the country’s most populous areas.

Reuters reported on Thursday that the dramatic Houthi advance down Yemen’s Red Sea coast this week came with direct guidance from Iran’s Revolutionary Guards seeking to open a new front in Iran’s war with the US, according to Yemeni government, Iranian and regional sources.

Iran told the Houthis last week to escalate their attacks on Saudi Arabia, a close US ally, and promised more funding, weapons and senior officers to help them do so, ​two Iranian sources said.

While Iran describes the ​Houthis as an ally, it publicly denies ⁠giving them military direction, saying they are “not a proxy”.

Trump Rejects Saudi Calls to Bomb Houthis, Axios Reports

Saudi Arabia has been bombing Houthi targets in Yemen but not the strategic areas the group has seized this week. This has raised questions about why Riyadh is not stepping in ​more forcefully to help its Yemeni government allies as Iranian arms and advice helped the Houthis make significant gains.

Saudi Crown Prince Mohammed ​bin Salman called US President ⁠Donald Trump twice on Thursday and urged him to launch strikes against the Houthis, Axios reported, citing two US officials.

Trump rejected the request, and US officials said the administration does not intend to take direct military action against the Houthis at this time, the report said.

According to Axios, the US is increasingly concerned about the rapidly escalating conflict in Yemen and is stepping up support for Saudi Arabia while ​seeking to avoid direct military involvement.

Gulf foreign ministers plan to meet their Iranian counterpart in a push by ​Oman and Iran to secure buy-in for a temporary deal to manage shipping through the Strait of Hormuz, the Financial Times reported on Friday.

The gathering is scheduled to be held on Monday in the Omani coastal city of ​Salalah, the report said, citing two people briefed on the matter.

Reuters could not immediately verify the report.