Red Sea to Remain Volatile Despite Reduction in Shipping Attacks by Yemen-Based Al-Houthis

Although the Al-Houthi announcement and the lack of successful attacks since Dec. 10 may suggest a decrease in risk, many shipping companies will likely continue avoiding the Red Sea due to ongoing uncertainty. The Al-Houthi pledge to reduce its attacks depends on the success and longevity of the Israel-Hamas ceasefire. If the ceasefire collapses – a plausible scenario, given that the final two stages of the agreement remain unresolved – it would likely trigger a resumption in the Al-Houthi campaign against shipping.  

The Al-Houthis have not fully committed to a complete cessation of attacks against vessels. Ships fully owned by Israelis or flying an Israeli flag remain potential targets until all elements of the ceasefire agreement are implemented, which is not expected to occur until May 25 at the earliest. This ongoing threat raises concerns for shipping, as the risk of targeting errors, misidentification, or weapon malfunctions remains. Past attacks have demonstrated the group’s dependence on outdated intelligence, further heightening threats to maritime operations.

These factors will contribute to increased shipping costs due to longer times at sea or, for companies returning to the Red Sea, higher insurance premiums. Lead times for goods sent around the Cape of Good Hope will remain 10-15 days longer on average than via the Suez Canal route. 

US President Donald Trump’s approach to both Iran and the Al-Houthis will also be critical in shaping the region’s maritime security. One of his first actions was to redesignate the Al-Houthis as a “Foreign Terrorist Organization,” signaling a hardline stance against the group. Further actions against the group – whether in response to Al-Houthi escalation or Trump’s desire to assert strength – could trigger a renewed wave of attacks on shipping.

The Al-Houthi campaign has demonstrated the group’s ability to disrupt international shipping at a critical chokepoint, underscoring their growing influence over maritime security in the region. Their success has set a troubling precedent, enabling the group to credibly threaten future disruptions to advance demands or objectives. By leveraging their ability to affect global trade and regional stability, the Al-Houthis have significantly enhanced their strategic importance.

Despite facing years of sustained pressure – including prolonged conflict with Saudi and UAE-backed factions during Yemen’s civil war and extensive air campaigns by Saudi Arabia, the UAE, and, more recently, the US, UK, and Israel – the Al-Houthis have proven resilient. Their operational infrastructure remains intact, and they continue to possess the capacity to carry out attacks, underscoring their persistent threat to maritime security.

The Al-Houthi threat is amplified by Iran’s support, as the group serves as a proxy for Tehran’s strategic objectives. Following the collapse of Bashar al-Assad’s regime in Syria and defeats suffered by Lebanese Hizballah and Hamas at the hands of Israel, the Al-Houthis could emerge as the leading force in Iran’s “Axis of Resistance.” This would likely result in increased Iranian support, including increased and more advanced weaponry.

In the event of heightened tensions between Iran and the US, Iran could use the Al-Houthis to apply pressure in the Red Sea. A hardline stance on Iran by the Trump administration could also bring about a repeat of events from late in Trump’s first term, with Iran conducting sub-threshold operations in the Strait of Hormuz. These included long-range UAV strikes on vessels, the use of limpet mines in the Arabian Gulf, and harassment of vessels close to Iranian territorial waters. A significant escalation, such as the oft-threatened “closure” of the strait by Iran, would have major effects on global energy markets as approximately 30 percent of liquefied natural gas (LNG) and 25 percent of global oil consumption transit through the strategic chokepoint daily. 

Russia too had threatened to supply the group with advanced weapons if restrictions on the use of Western-supplied long-range weapons were to be lifted; though this “red line” has already been breached, there has yet to be any evidence of Russian weaponry reaching Yemen. Russia might nevertheless use the incentive of weapon supplies to encourage the Al-Houthis to continue disrupting western-aligned shipping. 

The Red Sea will remain a high-threat area for international shipping over the coming months due to the persistent Al-Houthi threat, the fragile Israel-Hamas ceasefire, and broader geopolitical tensions involving Iran, the US, and Russia. These factors will sustain elevated shipping costs, insurance premiums, and lead times, while any escalation threatens further disruption to global energy markets and maritime trade.

Learn more about leveraging global intelligence to stay ahead of maritime disruptions and other key risk trends in the Global Risk Forecast 2025 report.