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The conflict between Israel and Hamas is spreading to other parts of the Middle East. In Yemen, that could start to muck up global trade routes.
Driving the news: Yemen’s Houthi rebels — an Iran-backed insurgent group that aims to govern Yemen and supports any actions against Israel, its sworn enemy — have intensified attacks on cargo ships passing through the Red Sea in an act of support for Hamas.
- The Houthis govern northern Yemen, effectively giving them control of part of the Bab el-Mandeb Strait — a vital trade route connecting the Red Sea and the Indian Ocean.
Catch-up: The Houthis have sporadically fired at cargo ships over the years, but when the war broke out, they began targeting any Israeli or Israel-bound ship with drone attacks, boat missiles, and rockets launched from the shore to try to pressure Israel into ending the war.
- The most stunning attack happened in November when they captured the Galaxy Leader, a ship owned by an Israeli billionaire, and took the crew hostage.
- Recently, their motive has grown unclear as attacks become seemingly random, with non-Israeli ships from Norway, Hong Kong, and Liberia coming under bombardment.
Why it matters: Around 40% of international trade passes through the area — in particular oil and grain — making it a vital trade route. If the attacks continue, ships will take longer routes to avoid the area entirely, which would disrupt the flow of goods and increase prices.
- Danish shipping company Maersk, the world’s second-largest container shipper, said it was pausing all journeys through the Red Sea after one of its vessels was targeted.
- The increased risk of damaged ships and lost cargo has also boosted insurance premiums — for Israeli ships in the area, premiums have already surged ~250%. That’s an even better reason than missiles for some shippers to avoid the area.
What’s next: The U.S. has sent a stern warning to the Houthis to cut it out and is working on a multinational task force to increase naval operations in the area to fend off attacks.—QH