* Saudi air strikes in Yemen stoke oil security fears
* Yemen sits on Gulf of Aden, 'chokepoint' to oil supplies
* Threat to Arab supplies on way to Europe
* Heavy Western military presence protects Gulf of Aden (Updates throughout, changes dateline to LONDON)
LONDON, March 26 (Reuters) - Brent crude oil pared early gains but still rose more than 4 percent towards $59 a barrel on Thursday after Saudi Arabia and its Gulf Arab allies began a military operation in Yemen.
The air strikes against Houthi rebels, who have driven the president from Yemen's capital Sanaa, could stoke concerns about the security of Middle East oil shipments.
Brent futures were up $2.39 at $58.87 by 0923 GMT, off a session high of $59.78. U.S. crude was up $2.18 at $51.39 a barrel, having reached $52.48 earlier in the session.
"Geopolitical risk like this has been on the back burner for a while because we've been focussing on global oversupply," said Ole Hansen, head of commodity strategy at Saxo Bank.
"This news has not made the oversupply go away. The upside potential is limited unless something escalates. We need to see how this unfolds over the next couple of days," he said.
The risk from the attack in Yemen was heightened because the Shi'ite Houthis have received some support from Iran, Saudi Arabia's long-time rival for dominance in the Middle East.
The Iranian Foreign Ministry demanded an immediate halt to all military "aggressions" in Yemen, the semi-official Fars news agency reported.
A ground offensive may be needed to restore order in Yemen, a Saudi source familiar with defence matters said.
In order to export to Europe, Arab producers have to ship oil past Yemen's coastlines via the Gulf of Aden to get to the Suez Canal.
The waters between Yemen and Djibouti, known as Bab el-Mandeb, are less than 40 km (25 miles) wide. They are considered a "chokepoint" to global oil supplies by the U.S. Energy Information Administration (EIA).
The EIA estimates that 3.8 million barrels a day of crude oil passed through Bab el-Mandeb in 2013, the latest year for which estimates were available.
The region is heavily populated with Western military forces. The United States and France operate large military bases in Djibouti. NATO's anti-piracy fleet also operates from the Gulf of Aden.
China's Foreign Ministry said it was deeply concerned about the worsening situation in Yemen.
Some analysts, however, said the strikes could lead to more stability in the region, if they resolved the conflict in Yemen.
"If this is a prelude to a bigger operation in the Middle East, that may lead to some stability in the region," said Mari Iwashita, chief market economist at Tokyo's SMBC Friend Securities.
(Additional reporting by Aaron Sheldrick and Osamu Tsukimori in Tokyo, Meeyoung Cho in Seoul, Henning Gloystein and Florence Tan in Singapore; Editing by Dale Hudson)
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