Yemeni Houthi Rebels Join Iran’s War: Will the Red Sea Be Blocked Too?

[Financial News]

The Houthi rebels in Yemen have ultimately joined the Islamic Republic of Iran’s war.
According to Cable News Network (CNN) and other foreign media, the Houthi rebels launched two missile attacks on Israel on the 28th (local time). They fired a second cruise missile toward Israel several hours after the first launch.
The Houthi rebels are an armed group backed by the Islamic Republic of Iran.
However, according to Israeli security officials, both missiles were intercepted and caused no damage.
As they began the missile attacks, the Houthi rebels announced, "We have simultaneously launched ballistic missiles targeting Israel’s sensitive military bases."
Just as the Islamic Republic of Iran has threatened to close the Strait of Hormuz, the Houthi rebels could block the entrance to the Red Sea that leads to the Suez Canal.
At the end of 2023, they also attacked ships in the Red Sea in retaliation for Israel’s assault on Hamas in the Gaza Strip.
When the Red Sea was effectively blocked, vessels had to sail around the Cape of Good Hope instead of using the Suez Canal to cut across the Arabian Peninsula and Africa. In some cases, voyages were extended by up to about two weeks, causing severe disruption to global logistics.
According to the International Maritime Organization (IMO) and others, rerouting via the Cape of Good Hope raises operating costs such as fuel and insurance by more than 30%, driving up logistics expenses.
The Bab el-Mandeb Strait, the gateway to the Suez Canal, handles 12% of global seaborne trade and 8% of liquefied natural gas (LNG) shipments.
Previously, the International Energy Agency (IEA) warned in its monthly oil market report this month that "if energy transport through the Bab el-Mandeb Strait is cut off, imbalances in LNG and crude oil supplies between Europe and Asia will worsen and could keep upward pressure on international oil prices."
Meanwhile, West Texas Intermediate crude oil (WTI) for May delivery, the U.S. benchmark, broke above $100 per barrel in after-hours trading on the 27th, closing at $101.18.


dympna@fnnews.com Song Kyung-jae Reporter