Yemen's Houthi Rebels Seize Strategic Strait, Threatening Global Trade and Israel

Houthi rebels in Yemen have rapidly expanded their control in the southwest, capturing territory adjacent to the Bab el-Mandeb Strait, a critical global shipping route. This advance, which saw the group seize areas previously held by the internationally recognized Yemeni government in about a week, including the Mokha region and strategic islands, poses significant risks to international trade between Asia and Europe, as well as to Saudi Arabia and Israel.

According to UN figures cited in the report, recent fighting resulted in approximately 500 deaths and displaced around 46,000 people. Saudi Arabia, supporting the Yemeni government, conducted airstrikes against Houthi positions but failed to halt their advance, partly due to poor coordination among Yemeni government forces and allied militias.

The Bab el-Mandeb Strait connects the Red Sea to the Gulf of Aden and the Indian Ocean, serving as a vital passage to the Suez Canal. Previously, Houthi attacks on shipping required long-range drones, anti-ship missiles, and surveillance. However, their new coastal positions and control of islands allow for more effective monitoring and the potential use of shorter-range weapons, directly threatening vessels.

This development is particularly concerning for Israel due to its maritime link through the Red Sea and access to the port of Eilat. The ongoing instability in the strait could further complicate this route. Meanwhile, Saudi Arabia faces dual pressure, with its oil infrastructure also targeted, including a strategic pipeline that was temporarily halted. This situation, coupled with tensions around the Strait of Hormuz, increases risks for Saudi oil exports.

Despite the increased threat, a Houthi political bureau representative stated the group does not intend to completely block international shipping through the strait, though tankers carrying Saudi oil are an exception. The mere possibility of attacks, however, forces shipping companies to factor in higher insurance costs and potential route diversions, such as the significantly longer journey around Africa.

The heightened tensions coincide with a sharp rise in energy prices, with oil exceeding $100 per barrel and U.S. diesel prices surpassing $6. Further escalation at Bab el-Mandeb could exacerbate pressure on energy markets, especially if combined with disruptions at the Strait of Hormuz, jeopardizing multiple key supply routes from the Middle East. For Israel, the Houthi advance signifies a strengthened hostile force to its south, potentially impacting the security of shipping, the port of Eilat, and the regional economy.