In less than three months the full picture of the Middle East shipping routes changed completely. We were used that about 12% of global maritime trade passes through the Bab al-Mandeb Strait, which controls access to the southern Red Sea (between Djibouti and Yemen, En). Now, actually since mid-November the number of containers has fallen by 70%.
Many shipowners have preferred to interrupt traffic in this area for an alternative route around the Cape of Good Hope. Everything started in the wake of Israel's war on Gaza after the October 7 Hamas attack on Israel, Houthi rebels in Yemen pledged disruption on all ships destined for Israel through the Red Sea's Suez Canal.
The disruption of world trade is evident in the number of companies using this container ship route, 90% decline compared to figures one year ago. So new geopolitical alliances look like emerging in the Gulf also because in the Atlantic Pacific area the drought that has hit the Panama Canal, significantly slowing down the transit of ships between Asia and the United States. While normally around forty container ships pass there every day, in mid-January this figure was reduced to 24 daily passages.
How it started
Back to Gulf, Iranian-backed Houthi militants, who control swathes of Yemen, have used an array of sophisticated weapons, including ballistic missiles and “kamikaze” drones, in their attacks on international shipping in the Red Sea in support of Palestinian militant group Hamas in its war with Israel in the Gaza Strip.
The attacks began last November 19th when Houthi commandos landed a helicopter on the Galaxy Leader cargo vessel as it was passing through the southern Red Sea. They redirected it toward Hodeidah port in Yemen and seized the crew, who are still being held. Since then, 29 more ships have been attacked in the area, with 13 of those suffering direct strikes from missiles or drones. The attacks have caused major disruptions to global trade, some 12% of which passes through the Red Sea.
A new target
And nowadays the situation is getting even worse. The new target of the next attack by Yemen’s Houthis could be submarine communications cables in the Red Sea. Lookalike the Houthis, undeterred by Western strikes, might turn to damaging submarine cables near Yemen. These cables are essential for the functioning of the internet and transferring financial data in the West, and the report cautions that if they are attacked the global economy will likely be impacted significantly.
Yemen's strategic location for the passage of submarine communication cables, with the Bab al-Mandab area serving as a transit point not only for ships but also the submarine cables. While the Houthis have not explicitly expressed intent to damage cables, a Houthi-linked Telegram channel recently published a map of cables in the Red Sea, with a message: “There are maps of international cables connecting all regions of the world through the sea. It seems that Yemen is in a strategic location, as internet lines that connect entire continents – not only countries – pass near it.”
The safety of all area is deeply in danger and the risks to affect globally the security and the economy are every day more severe. These cables are considered a critical component in the global digital infrastructure, serving around 95% of international data and communication, including financial transactions worth $10 trillion daily. Therefore, even partial damage to these cables could disrupt internet access and cause significant economic disruptions worldwide. It’s a very tough moment.
Trade routes under attack
Houthi militants are using a combination of weapons to target commercial ships. The analysis shows how Houthi drone and missile activity has escalated since the Gaza war began, and has continued despite Western military airstrikes on their bases in Yemen, which began on January 11th.
The area is very sensitive and looks like Houthi have a killer strategy. Their attacks have targeted ships in the southern Red Sea and the neighboring Gulf of Aden, which are joined by the Bab al-Mandab strait, a chokepoint between the Horn of Africa and the Middle East. In Arabic, Bab al-Mandab means "Gate of Tears", a reference to the strait's precarious navigation. The narrow waterway lies between Djibouti and Eritrea on the coast of east Africa and western Yemen, much of which is under Houthi control. Bab al-Mandab is a strategic link between the Mediterranean Sea and Indian Ocean: exports to the Western markets from the Gulf and Asia must pass through before entering the Suez Canal. It’s a global shipping disruption moment.
A threat on economy
Shipping companies have been re-routing some sailing via Africa's southern Cape of Good Hope as the attacks continued. The disruption threatens to drive up delivery costs for goods, raising fears it could stoke global inflation. Container shipping, which transports consumer goods, has been the segment most impacted by the attacks in the Red Sea due to fixed routes through the waterway. In the period from the start of December last year to the end of January, 373 container ships are estimated to have re-routed around Africa, according to analysis from supply chain platform project44. The number of container vessels sailing through the Suez Canal has fallen by about 65% since the attacks began, project44 data showed. Because of the high risks, seafarers are signing agreements to receive double pay when entering the high-risk zones around Yemen, according to contract agreements viewed by Reuters and union officials. The Suez Canal is used by roughly one third of global container ship cargo. Redirecting ships around the southern tip of Africa is expected to cost up to $1 million in extra in fuel for every round trip between Asia and northern Europe. Let’s see what’s next.