Yemen’s Saudi-backed, internationally recognised government said on Sunday it was launching a major military campaign to recapture all areas controlled by the Iran-backed Houthis, sharply escalating the country’s long-running conflict.

The announcement came as the Houthis said they had launched ballistic missiles and drones at Saudi Aramco sites in Riyadh and the Khurais area. The Saudi-led coalition dismissed the Houthi claims of strikes near Riyadh. Yemen’s military separately launched strikes on Houthi targets amid the rising tensions.

The escalation kept energy markets on edge, though oil prices slipped on Monday as rising Middle East crude exports and the G7’s coordinated release of emergency oil stocks eased near-term supply fears. Brent crude traded around $101 to $102 a barrel. Gold held above $4,150 an ounce as investors weighed the geopolitical risk. Yemen’s government says the campaign will continue until all institutions of state authority are reinstated across the country’s territory.