Sept 17 (Reuters) - U.S. President Donald Trump said he hoped an end to the war against Iran was near, as the conflict, in its seventh month, escalated with Saudi aircraft pounding Yemen and Houthi fighters launching drones and missiles at Saudi cities.
The Iran-backed Houthis' lightning advance in Yemen along the Red Sea and their attacks on Saudi Arabia, along with attacks that damaged Saudi Arabia's East-West oil pipeline, have extended Tehran's reach in the war and heightened global oil-supply
risks.
As the war expands into a new theatre, the United States tightened its travel warning for Saudi Arabia, banning government employees from travelling within 20 miles (30 km) of the Yemen border.
Still, just hours after reports of the Houthis and Saudi Arabia fighting, Trump told reporters on Wednesday evening: "Well, hopefully we are towards the end of the war."
TRUMP SAYS IRAN WANTS A DEAL, OIL PRICE STILL ELEVATED
"They want to make a deal. We'll see how that works out," he said, referring to Iran, reiterating past comments. Trump also said he had heard from Iran "directly", without elaborating.
Trump has offered shifting goals and timelines for the war that began on February 28, when the U.S. and Israel attacked Iran and Tehran struck Israel and U.S. bases in Gulf states.
The extension of the war into Yemen threatens to worsen the global energy-supply shortage caused by the war, which has disrupted shipping through the Strait of Hormuz. The strait carried about 20% of global oil and LNG before the conflict.
Traders say a prolonged closure of Saudi Arabia's East-West pipeline could cut off as much as 4% of global oil supply. Saudi Arabia has not said when operations might resume.
The price of Brent crude hovered around $108 a barrel on Wednesday, close to its highest levels since May. The politically sensitive average retail price of diesel fuel in the U.S. hit another all-time high, above $6.30 a gallon for the first time.
But oil prices fell in early Thursday trade as reports of Saudi Arabia offering extra crude cargoes through Oman reduced fears of supply disruptions in the Middle East.
Brent crude futures dropped $1.24, or 1.2%, to $104.59 a barrel by 0049 GMT, while U.S. West Texas Intermediate futures were down $1.14, or 1.1%, at $101.29.
The rise in oil and gas prices due to the U.S.-Israeli war on Iran has become a major issue for Trump's Republican Party in the lead-up to November midterm elections.
TRUMP TO MEET GULF LEADERS, AXIOS SAYS, AS WAR SPREADS
Axios reported late on Wednesday that Trump was expected to meet Gulf leaders on the sidelines of the U.N. General Assembly on Tuesday to discuss the next steps in the conflict.
Citing sources it did not identify, the news outlet said Trump would meet with leaders or foreign ministers from the Gulf Cooperation Council countries: Saudi Arabia, the United Arab Emirates, Qatar, Bahrain, Kuwait and Oman. The State Department and the White House did not respond to requests for comment.
The Houthis on Wednesday released battlefield video of fighters seizing armoured vehicles from Saudi-backed forces. The video also showed warplanes flying overhead and huge explosions billowing into the sky from desert dunes.
Houthi military spokesman Yahya Saree said the group had launched fresh drone and missile strikes on the major Saudi Red Sea oil port of Yanbu and at a southern Saudi airbase at Khamis Mushait. He did not say when the strikes had taken place.
Saree said the Saudis had carried out as many as 450 air strikes on Yemen this week. Officials in the Saudi-backed government that controls southern Yemen have acknowledged that their forces and those of Saudi Arabia were conducting air strikes on Houthi positions, though Riyadh has not confirmed them.
Saudi Arabia has led a coalition battling the Houthis since 2015. The conflict had largely quietened under a ceasefire in recent years, but reignited when the Houthis declared a naval blockade against Saudi Arabia in July and fired at southern areas in the kingdom.
(Reporting by Reuters bureaux; Writing by Michael Perry; Editing by William Mallard)
