ince December 2023, global trade has been under pressure due to attacks against commercial ships in the Red Sea by the Houthis, an Iran–backed Yemeni militia. The attacks have endangered global trade and could further escalate the ongoing conflict in the Middle East involving countries like Yemen and Lebanon. In response to these aggressions, the United States assembled an international coalition called Operation Prosperity Guardian with Bahrain, France, the United Kingdom, Spain, Italy, and others. However, Tehran's next moves remain crucial. Even if the attacks benefited the Iran–backed coalition, it seems unlikely it wants to enter into a confrontation with the U.S.
The Suez Canal is home to 12% of the global goods trade. After the Houthis' attack, shipping costs increased by about 170%, and many merchant vessels were forced to change their routes, passing around the Cape of Good Hope in South Africa. Shipping and logistics companies like the Danish Maersk halted their activities in the area. Additionally, the energy market negatively reacted to the Red Sea crisis with rising fossil fuel prices earlier this year. According to estimates, about 12% of world–traded oil and 8% of liquefied natural gas transited in this area in the first half of 2023.
Additionally, the Red Sea crisis could escalate the ongoing war between Israel and Hamas. The Houthis are members of the so–called "Axis of Resistance," an Iran–led, anti–Israel coalition that encompasses Shiite militias like Hezbollah or Middle Eastern countries like Syria. If these actors were to enter the conflict, Israel would find itself engaged in multiple front wars, an option that its policymakers should avoid.
To understand the reasons behind Houthis' attacks, we should focus on Yemeni domestic politics rather than Middle Eastern diplomacy. Two years ago, the United Nations successfully mediated a truce between the Houthis and Saudi Arabia that opened up new opportunities to restore stability in the area. Shortly after, the Houthis' attempted to launch a process of institution–building to boost the country's impoverished economy, which was a substantial failure. Weeks before the war in Gaza, in October 2023, thousands of civilians gathered to celebrate the September 1962 Revolution Day in Yemen, which marked the overthrow of the oppressive Imamate regime. Remembering this day, protesters symbolically rejected the Houthis' government.
The Houthis are trying to exploit the war in Gaza to divert the Yemeni public opinion from their economic and political failures. According to Eleonora Ardemagni, Senior Associate Research Fellow at ISPI:
"[The ongoing crisis] allows them to strengthen the pressure on Saudi Arabia to gain further concessions in bilateral ceasefire talks. [...] The Houthis are betting on the fact that neither the Saudi kingdom nor the U.S. are going to react firmly against them."
However, the Houthis' space of action is not unlimited because they are subject to Iran, which remains crucial in determining the fate of the conflict in the Red Sea. In early January, UK Foreign Minister David Cameron said that Tehran would be considered partly responsible for the Houthis attacks. Iranian Foreign Minister spokesperson replied the allegations were unfounded, but its country will continue to support "Palestinian resistance movements."
Iran also decided to directly engage in the Red Sea by deploying the warship Alborz in the area. Neil Roberts, the secretary of the maritime insurance industry's Joint War Committee, commented to Foreign Policy:
"The arrival of the Alborz is definitely a warning, and it's an escalator more. But it's not clear what her task is. She's just sitting there."
It is unclear if Tehran will use it to escort ships bringing weapons to the Houthi rebels or if it will have military use.
The Operation Prosperity Guardian aimed to restore trade security while avoiding the full–scale war scenario; however, it did not gather broad support among Middle Eastern governments. For example, Saudi Arabia, a country that has been at war with the Houthis since 2014, did not join it. Riyadh does not want to harm bilateral ties with Tehran after the normalization agreement they reached last year and doesn't want to be seen as explicitly supporting Israel.
Thus, after having shot down tens of missiles and drones launched by the Houthis, the U.S. and the U.K. decided to launch strikes against Houthi–controlled areas in Yemen. This was a major step in the ongoing crisis both for Western involvement in the area and the possibility of Iranian retaliation, and yet, the Houthis did not halt their assaults on ships transiting in the Red Sea.
Iran's goals in the area can change rapidly over time and depending on the course of the Israel–Hamas war. Even if it is unlikely that Tehran wants a confrontation with the U.S., this move has increased its projection of power in the Red Sea. Considering the economic damages that have mainly affected the West, the crisis in the Red Sea has so far benefited countries hostile to Israel. The risks of a broader Middle Eastern escalation remain very high on multiple fronts, especially in the Lebanese–Israel border, in Iraq, which is pushing for a U.S. troops expulsion, and lastly, in the area between Pakistan and Iran, where some recent military clashes have occurred.
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After Gaza, the Middle East crisis extends to the Red Sea
Commercial shipping on the Red Sea is being increasingly targeted by the Houthis in the wake of the Gaza conflict, and could threaten further regional escalation, according to Elia Preto Martini. Image by Thomas Ulrich from Pixabay
January 23, 2024
Global trade is under increased pressure due to attacks against commercial shipping in the Red Sea by the Houthis, an Iran–backed Yemeni militia. Tehran’s next decisions will be crucial in determining whether these attacks cause further regional escalation, writes Elia Preto Martini.
S
ince December 2023, global trade has been under pressure due to attacks against commercial ships in the Red Sea by the Houthis, an Iran–backed Yemeni militia. The attacks have endangered global trade and could further escalate the ongoing conflict in the Middle East involving countries like Yemen and Lebanon. In response to these aggressions, the United States assembled an international coalition called Operation Prosperity Guardian with Bahrain, France, the United Kingdom, Spain, Italy, and others. However, Tehran's next moves remain crucial. Even if the attacks benefited the Iran–backed coalition, it seems unlikely it wants to enter into a confrontation with the U.S.
The Suez Canal is home to 12% of the global goods trade. After the Houthis' attack, shipping costs increased by about 170%, and many merchant vessels were forced to change their routes, passing around the Cape of Good Hope in South Africa. Shipping and logistics companies like the Danish Maersk halted their activities in the area. Additionally, the energy market negatively reacted to the Red Sea crisis with rising fossil fuel prices earlier this year. According to estimates, about 12% of world–traded oil and 8% of liquefied natural gas transited in this area in the first half of 2023.
Additionally, the Red Sea crisis could escalate the ongoing war between Israel and Hamas. The Houthis are members of the so–called "Axis of Resistance," an Iran–led, anti–Israel coalition that encompasses Shiite militias like Hezbollah or Middle Eastern countries like Syria. If these actors were to enter the conflict, Israel would find itself engaged in multiple front wars, an option that its policymakers should avoid.
To understand the reasons behind Houthis' attacks, we should focus on Yemeni domestic politics rather than Middle Eastern diplomacy. Two years ago, the United Nations successfully mediated a truce between the Houthis and Saudi Arabia that opened up new opportunities to restore stability in the area. Shortly after, the Houthis' attempted to launch a process of institution–building to boost the country's impoverished economy, which was a substantial failure. Weeks before the war in Gaza, in October 2023, thousands of civilians gathered to celebrate the September 1962 Revolution Day in Yemen, which marked the overthrow of the oppressive Imamate regime. Remembering this day, protesters symbolically rejected the Houthis' government.
The Houthis are trying to exploit the war in Gaza to divert the Yemeni public opinion from their economic and political failures. According to Eleonora Ardemagni, Senior Associate Research Fellow at ISPI:
"[The ongoing crisis] allows them to strengthen the pressure on Saudi Arabia to gain further concessions in bilateral ceasefire talks. [...] The Houthis are betting on the fact that neither the Saudi kingdom nor the U.S. are going to react firmly against them."
However, the Houthis' space of action is not unlimited because they are subject to Iran, which remains crucial in determining the fate of the conflict in the Red Sea. In early January, UK Foreign Minister David Cameron said that Tehran would be considered partly responsible for the Houthis attacks. Iranian Foreign Minister spokesperson replied the allegations were unfounded, but its country will continue to support "Palestinian resistance movements."
Iran also decided to directly engage in the Red Sea by deploying the warship Alborz in the area. Neil Roberts, the secretary of the maritime insurance industry's Joint War Committee, commented to Foreign Policy:
"The arrival of the Alborz is definitely a warning, and it's an escalator more. But it's not clear what her task is. She's just sitting there."
It is unclear if Tehran will use it to escort ships bringing weapons to the Houthi rebels or if it will have military use.
The Operation Prosperity Guardian aimed to restore trade security while avoiding the full–scale war scenario; however, it did not gather broad support among Middle Eastern governments. For example, Saudi Arabia, a country that has been at war with the Houthis since 2014, did not join it. Riyadh does not want to harm bilateral ties with Tehran after the normalization agreement they reached last year and doesn't want to be seen as explicitly supporting Israel.
Thus, after having shot down tens of missiles and drones launched by the Houthis, the U.S. and the U.K. decided to launch strikes against Houthi–controlled areas in Yemen. This was a major step in the ongoing crisis both for Western involvement in the area and the possibility of Iranian retaliation, and yet, the Houthis did not halt their assaults on ships transiting in the Red Sea.
Iran's goals in the area can change rapidly over time and depending on the course of the Israel–Hamas war. Even if it is unlikely that Tehran wants a confrontation with the U.S., this move has increased its projection of power in the Red Sea. Considering the economic damages that have mainly affected the West, the crisis in the Red Sea has so far benefited countries hostile to Israel. The risks of a broader Middle Eastern escalation remain very high on multiple fronts, especially in the Lebanese–Israel border, in Iraq, which is pushing for a U.S. troops expulsion, and lastly, in the area between Pakistan and Iran, where some recent military clashes have occurred.
