Houthi Threats Begin to Disrupt Commercial Shipping in the Red Sea
Strategic Question
Have Houthi threats already caused commercial disruption in the Red Sea?
Core Assessment
The declaration of a naval blockade against Saudi Arabia-linked commercial vessels is already shaping behaviour in the Red Sea. MarineTraffic data indicates an immediate commercial response, with tankers carrying Saudi crude bound for China and India reversing course despite no attacks reported.
The diversions suggest that commercial operators are responding to the perceived threats before any attacks associated with the blockade have been reported or the Bab al-Mandeb has been physically closed. Commercial shipping behaviour does not indicate that the Houthis have established control over Bab al-Mandeb; rather, it suggests that their threats are credible enough to influence routing decisions, potentially disrupting Saudi crude oil exports and increasing commercial risk. The Houthis' history of attacks may continue to alter commercial shipping while also raising the operating costs of vessels using the Red Sea through higher war risk insurance premiums.
Background
The Houthis have warned commercial shipping companies against using Saudi ports to load or discharge cargo as part of a marine blockade against Saudi Arabia. Previous attacks by the Houthis in solidarity with Palestinians in Gaza led to disruption in the Red Sea, with transits still not returning to pre-2023 conflict levels.
Strategic Assessment
The diversion of vessels suggests the Houthi threats are already influencing commercial behaviour. Although there is no evidence of kinetic attacks yet, the warnings have been sufficient to prompt commercial vessels to turn back. Prior Houthi attacks during the Gaza conflict suggest that commercial operators are reassessing routing options based on the credibility of the threats.
Similar to developments in the Strait of Hormuz, the signalling of a credible threat appears to be shaping commercial behaviour. Even without employing force, the Houthis appear to be altering commercial shipping through the credible threat of attack, allowing them to shape shipping without physically closing the Bab al-Mandeb. With two vessels bound for Asian markets rerouting, it suggests that political affiliation alone may not provide sufficient protection to mitigate current transit risk. In turn, Asian markets may need to adapt to uncertain conditions if disruption persists.
Commercial operators will now be reassessing whether these are verbal threats or whether current conditions are likely to persist. Shipping operators have previously demonstrated resilience to an evolving disruption in the Strait of Hormuz, suggesting they may adapt to security challenges. War risk insurance premiums may rise if commercial disruption persists.
Alongside market forces will be the international response to any physical attacks. The Houthis have previously demonstrated a willingness to attack international vessels, prompting an international military response. Previously, the U.S. launched an operation with allies to protect shipping that included the United Kingdom, Australia, Bahrain, and the Netherlands to degrade the Houthis’ capabilities. The potential for a Red Sea naval blockade will pose a challenge to Western allies and Saudi Arabia to respond to any disruption.
Shipping markets and any international response to the perceived threats in the Red Sea may be intertwined. Operators may wait for clearer allied security guarantees before transit resumes. Given the emergence of the Houthi threat, an international response is currently unknown.
What to Watch
Marine tracking data through the Red Sea.
Additional vessel diversions.
Saudi Arabian diplomatic and military responses.
International diplomatic and naval responses to threats of closing the Red Sea.
War risk insurance premiums and commercial risk assessments.
Houthi statements regarding Saudi Arabia and imposing conditions on the Red Sea.
Strategic Indicator
Commercial Compliance with Houthi Threats.
Assessment: ▲ Increasing
Iran-backed Houthi threats in the Red Sea may represent an expansion of the disruption in the Strait of Hormuz. Early commercial shipping data indicates the Houthi threats are already influencing operator behaviour, with tankers carrying Saudi crude to China and India rerouting despite no reported attacks, suggesting operator uncertainty under current conditions.
These initial diversions may encourage other commercial operators to exercise caution while reassessing transit risk. With no international response yet, similar routing decisions may become more frequent. Commercial disruption in the Red Sea is likely to increase until the operating environment becomes clearer.