Saudi Arabia and Ansar Allah continued to trade bombs and ballistic missiles. Saudis continue to downplay damage and claim interceptions. Aramco offices damaged more than Saudis initially admitted. Riyadh Airport hit again. Battles continue in Yemen. More ships hit in the Strait of Hormuz, and the IRGC Navy Chief is “impatient” to sink US warships.
Sanaa Shellacked, Riyadh Ripped, Aramco HQ Ablaze
In response to what they described as 2,281 Saudi airstrikes and missiles against their capital, Sanaa, and the governorates they hold since the escalation began, Ansar Allah claimed it carried out “a high-quality military operation targeting Aramco in Dhahran, in the Eastern Province, King Khalid International Airport, and the Aramco refinery in Riyadh” using “a large number of ballistic missiles, cruise missiles, and drones.”
They declared that operations “will continue in the coming days, targeting Saudi enemy airports and oil facilities” and issued a warning to “all international shipping companies, as well as civilians and workers at those airports and companies, to stay away from them and evacuate them immediately, as they have become legitimate targets. We will continue to impose the equation of siege for siege and escalation for escalation.”
Ansar Allah later counted 42 Saudi airstrikes and missiles in the previous 24 hours on Sanaa, the governorates of Taiz, Lahj, Marib and Amran, and Mayun (Perim) island.
The Saudis, per AP, claimed to have intercepted two drones, four cruise missiles and one ballistic missile targeting Riyadh, a ballistic missile targeting Dhahran and a cruise missile targeting Al-Kharj.
Riyadh Civil Defense, per KDH News, said debris from an intercepted strike left one person injured; SPA published images of a damaged building and a vehicle with “a large cylindrical object, seemingly part of a missile, lodged in its hood.”
Reuters reported that damage to Aramco’s Dhahran HQ from Tuesday’s strike was more extensive than initially reported. Three people with direct knowledge told Reuters the headquarters “suffered extensive damage,” with a fire spreading across several floors.
Two sources said the fire started on the ninth floor of the south wing of the office block and spread between the sixth and 10th floors. Another source said the top three floors, where the office of Aramco CEO Amin Nasser is located, were severely damaged, “with part of the ceiling caved in and windows and doors blown out.”
Two sources told Reuters that operations continued normally, but some employees were asked to work from home; a fourth said some functions were shifted to global offices and the fire was still burning into the early hours of Wednesday.
The facility hosts an operations centre overseeing onshore and offshore rigs, refineries, export terminals and thousands of kilometres of pipeline, covers 58 square kilometers and is home to a reported 11,000 people, per The National.
The Wall Street Journal reported that Ansar Allah is developing new missiles with Chinese tech:
The Houthis shipped in from a Chinese supplier a range of components needed to make a version of one of Iran’s most powerful weapons, the Kheibar Shekan Iranian precision-guided missile, said the report by Conflict Armament Research, a group that works in conflict zones and reports on the use of weapons and their supply chains. The Houthi missile would have a range up to about 1,200 miles, putting all of Saudi Arabia and Israel within reach.
Iran used the Kheibar Shekan—a cheap, mobile, precision weapon first displayed in Tehran in 2022—against American bases with some success during the war with the U.S. last spring, The Wall Street Journal has previously reported.
…The Houthis have become more autonomous and capable of producing their own weapons after years of being dependent on Iran and its Lebanese ally, Hezbollah, said Mohammed al-Basha, founder of Basha Report, a Washington-based risk-advisory firm. Tehran had long shipped in missiles for the Houthis to reassemble and use.
“They have developed domestic manufacturing capabilities with artificial intelligence for drone and missile softwares, diversified their supply chains, accumulated operational experience, and established relationships with regional smugglers and international procurement networks,” Basha said.
Investors in Saudi Arabia should hope Ansar Allah’s ordnance doesn’t get any more effective.
Getting Blasted Is Bad For Business
Arabian Gulf Business Insight reports that “Houthi attacks deepen Saudi stock market sell-off:”
Riyadh’s stock exchange fell to a 43-month low on Wednesday as Houthi attacks from Yemen disrupt air travel and supply chains in Saudi Arabia.
The All-Share Index, which tracks the main market, closed at 10,139 points, its lowest since March 16, 2023, when it ended at 9,977.
The latest slump followed a series of missile and drone attacks on Saudi Arabia that have forced the kingdom to close the main airport in Riyadh, the capital. Numerous airlines have cancelled flights across the country, forcing organisers to call off events and travellers to postpone business trips.
“We’re seeing selling across the board in Saudi,” said Shahrukh Saleem, a portfolio analyst at Dubai-based asset manager Mashreq Capital, “and it’s largely geopolitical. Even the names foreign investors favoured until recently are now under pressure.”
Shares in state-owned oil giant Aramco, by far the largest company listed on the exchange, fell 2 percent following an attack on its headquarters in Dhahran on Tuesday evening.
Fortune’s Melissa Hancock analyzes the impact of Ansar Allah’s strikes on the Saudi economic diversification efforts:
James Reeve, a Saudi macro consultant who formerly worked as a senior director for the kingdom’s Public Investment Fund, told me that foreign investments already made in Saudi are unlikely to be reversed in the near term.
“I think more troubling for the Vision 2030 story is the impact on new FDI (foreign direct investment) inflows,” said Reeve.
“For foreign firms weighing up significant capital investments in the kingdom, the images of missiles falling apparently unhindered on the capital’s airport will be shocking and difficult to forget. Those contemplating investments in tourist infrastructure will also have to weigh the impact on tourism inflows.”
“In the short term, this is clearly damaging,” Andreas Krieg, a Middle East security analyst at King’s College London, told me.
“The important effect is not simply physical damage to an airport or the cancellation of individual flights. It is the return of a security premium to doing business in Saudi Arabia. The immediate consequences are likely to be delayed investment decisions, higher required returns, and greater dependence on state capital.”
As one of the principal gateways into the Saudi capital and a foundation stone of the entire Vision 2030 project, the Houthi attacks on Riyadh’s airport directly threaten the kingdom’s economic strategy. It wants to become a global centre for business, logistics, tourism, hospitality and major global events; it has been chosen as host of both Expo 2030 and the FIFA World Cup in 2034.
Before the current attacks, the airport handled roughly 110,000 passengers a day—similar in scale to Miami International airport. It is also the base of Riyadh Air, a new airline backed by Saudi’s PIF, which seeks to establish the city as a major transport hub to rival Dubai and Doha.
These latest developments come as Riyadh is already grappling with rising fiscal challenges.
The kingdom recorded a fiscal deficit of 160 billion riyals ($42.7 billion) in the first half of 2026, up 71% from 93 billion riyals a year earlier, as it increased spending to prop up growth amid the ongoing U.S.-Iran war.
And nothing speaks louder than the abandonment of Crown Prince Muhammad bin Salman’s pet projects, per Semafor:
Saudi Arabia’s sovereign wealth fund is preparing to inform organizers of the 2034 men’s soccer World Cup that it plans to drop five new stadiums it proposed to build to host the tournament, according to people familiar with the matter.
Public Investment Fund will likely narrow its focus to three new stadiums as it cuts spending on some of its signature domestic investments, the people said. Dropping the five venues would leave the kingdom with 10 stadiums for World Cup matches. The changes are part of a revised plan the kingdom is preparing to submit to FIFA, the tournament’s organizers, the people said.
PIF is looking to drop plans to develop stadiums in King Abdullah Economic City and Qiddiya Coast, both near Jeddah; Roshn and New Murabba in Riyadh; and NEOM, in the kingdom’s northwest. Several of the cancelled stadiums are attached to broader real estate projects that have been halted or where work has slowed.
Now let’s move to the ground war in Yemen.
According to Their Spokesmen, Everyone Is Winning, Except the People
The fog of war is dense, and neither side wants to give an inch in the narrative war.
The Saudi-backed forces claim to have advanced in the mountains near Taiz, the besieged third-largest city in Yemen, per ImArabic:
Fighting under Operation “Dawn of Yemen” entered a new phase of escalation on Wednesday as clashes between government forces and the Houthis intensified on several fronts, particularly in western Taiz governorate, southern Marib and the Al-Mudaraba district in Lahj governorate. Strikes simultaneously targeted positions and facilities used by the Houthis in areas under their control.
Military operations expanded as government forces sought to recapture strategic positions and disrupt Houthi supply lines. Concern over the humanitarian consequences is growing, particularly in Taiz, where the Houthi siege restricts supplies and has sharply increased the prices of essential goods.
Over the past twenty-four hours, the Al-Dabab front west of Taiz city witnessed fierce fighting described as among the area’s largest battles in months. Exchanges of fire and shelling left people dead and wounded on both sides.
…
In Lahj governorate, clashes are concentrated in Al-Mudaraba district. According to military sources cited by Yemeni media, government forces supported by Al-Subaiha tribes are fighting the Houthis following attacks on Al-Aghbarah, Al-Mansoura and Al-Muhawala.Reinforcements from the Giants Brigades have reached the district’s front lines to repel attacks and prevent Houthi breakthroughs. The front’s importance stems from its proximity to strategic areas overlooking the Bab al-Mandab Strait. Changes in territorial control could affect coastal road security and surrounding military positions.
In Marib governorate, the Yemeni Armed Forces’ media centre released videos it said documented an assault on Houthi fortifications on the southern front, reporting that fighters fled before advancing government troops. These developments form part of government operations intended to increase pressure on Houthi positions on the southern and eastern fronts.
For their part, Ansar Allah released footage of their forces “expelling Saudi enemy formations at Dhubab airport, burning and seizing a number of its vehicles and capturing a number of them.”
SouthFront reported over the past 48 hours Ansar Allah forces advanced along the Aghbarah and al-Mudaraba fronts in western Lahj, taking al-Sharjan, al-Ka’lalah, Harwazu, Jabal Harwazu, al-Khabakhib and Lower al-Mudaraba, positions held by the Giants Brigades, the National Shield Forces and armed Subaiha tribesmen.
These areas are all near the Red Sea coast, in the southwest of the country.
Ansar Allah spokesman Brigadier General Yahya Saree also claimed that their forces had scored a direct hit on a Saudi “Typhoon” fighter jet over Saada Governorate using a surface-to-air missile.
Saree said that the targeted aircraft had taken off from Taif Air Base, sustained a direct hit, and is at risk of crashing.
One report I have no reason to doubt is this from the Red Cross, via Reuters, that front-line hospitals in Marib, Taiz and on the Red Sea coast are treating unprecedented numbers of weapon-wounded; some admitted more than 700 casualties in a single week.
The UN’s International Organization for Migration reported on October 7 that more than 200,000 people have been displaced since the clashes escalated.
Persian Gulf Continues to Do Its Bermuda Triangle Impression
Reuters reports that two ships, a container ship and a dry bulk carrier, sank near Hormuz after being hit by projectiles. The IRGC Navy says the container ship hit a naval mine while using “an unauthorized and dangerous route.”
Per Iran International the 10 ships struck since Sunday are the most for any such period of the war.
The IRGC Navy chief Gen. Ali Ozmaei added insult to injury, saying, “If the Americans want to see whether the Strait of Hormuz is open or closed, let them enter the violated route in the strait. We will deal with violating vessels in the Strait of Hormuz.”
In a separate interview with Tasnim, his first TV interview, Ozmaei said, “If the Americans think the Strait of Hormuz is open, let them come closer. We are impatient to sink American warships. We are counting down every moment until this happens.”
IRGC spokesman Brig. Gen. Hossein Mohebbi warned the US via Tasnim that “This time, the consequences for the US will be far more painful.” Iran used mainly older-generation weapons in the 40-day war and now has much more advanced weaponry, he asserted.
Trump Talks
For his part, POTUS Trump told an Alaska crowd, “Oh, wait till you see what we do to Iran. We’re going to do a number. Wait till you see. They’re just waiting. They’re waiting. Wait till you see what we do to Iran, because we’ve sort of had it. You know, we’ve had it. The big thing is they were not going to have a nuclear weapon, and they won’t. That’s buried under thousands of tons of rock.
At the same rally, per Fox News: “They were the bully of the Middle East, but they’re the bully of the Middle East no longer… it’s going to end very soon. Very soon. They have no Navy. They have no air force. They have no anti-aircraft.”
He also said: “We opened the straits… We’ve been taking more oil out of the straits now than we did before the war started. Believe it or not, we control the straits.”
Earlier Tuesday outside the White House: “They have no economy. They have 300% inflation. They have no money. They’re not paying their troops… We’ll make a decision on Iran very soon.”
Bibi Says No Strikes
Reuters reports that Netanyahu says he is not seeking to attack Iran again before Israel election.
“It is not convenient for us, it’s no good. Even if Iran fires missiles at us they will blame me.”
Asked if Israel is helping Saudi Arabia against Ansar Allah: “I don’t get into those matters… many countries in the Middle East are turning to us.”
Defense Minister Israel Katz, in southern Lebanon: Hezbollah would “lose additional territories in southern Lebanon within the Nabatieh and Litani regions, which will become part of Israel’s permanent security zone”; he said a million Shi’ites would be displaced.
Stay safe, y’all.