Red Sea Attacks: Yemen's Civil War and Global Trade Crisis

Yemen's Civil War and Global Trade Crisis

How have Houthi attacks in the Red Sea impacted global trade, shipping costs, and the environment?

Houthi attacks in the Red Sea have had a profound and far-reaching impact on global trade, significantly increasing shipping costs, and adversely affecting the environment

Impact on Global Trade

Disruption of a Strategic Corridor

The Red Sea is a vital strategic corridor that connects Asia to Europe via the Suez Canal, facilitating international trade and the movement of naval forces. It is one of the world's busiest shipping lanes and the shortest route between Europe and Asia, playing a crucial role in global container shipping.

In 2023, approximately 12% of global trade and 30% of the world's container traffic, valued at over USD1 trillion, passed through the Suez Canal. As of January 2024, about 15% of global seaborne trade, including 8% of global grain, 12% of seaborne oil, and 8% of global liquefied natural gas (LNG) trade, relied on this route.

Rerouting of Vessels The unprecedented assault on commercial shipping by the Houthis, which began in November 2023, forced most shipping companies to reroute their vessels around Africa via the Cape of Good Hope.

This longer route adds significant costs and negatively impacts the global supply chain, contributing to increased inflation and exacerbating food insecurity in developing nations.

By the end of March 2024, maritime traffic through the Suez Canal and the Bab-el-Mandeb Strait had halved, while traffic via the Cape of Good Hope had doubled. Around 80% of marine cargo vessels were rerouted from the Suez Canal, resulting in an 82% decrease in container tonnage passing through the Canal from December 1, 2023, to February 12, 2024.

Direct Attacks and Casualties

The Houthis have carried out numerous attacks on commercial vessels. By March 2024, 43 cargo vessels had been targeted, with 21 hit directly by missiles or drones. These attacks have resulted in significant damage to ships.

The Galaxy Leader cargo vessel was hijacked in November 2023, with its crew captured and held hostage.

The attacks have led to vessels being sunk, including the Rubymar in February 2024 and the Tutor in June 2024.

Fatalities have been reported, with at least three seafarers killed by March 2024. The True Confidence attack in March 2024 killed three crew members. The Tutor attack resulted in one crew member's death. Most recently, the attack on the Eternity city in July 2025 killed three mariners and wounded two others.

Impact on Ports and Trade Figures:

The Houthi actions caused an 85% drop in activity at Israel's Eilat Port by December 21, 2023. By July 2024, the CEO of the Port of Eilat stated the port was in a state of bankruptcy. The increased shipping costs and transit times have led to a downward path for global trade, with import and export figures for Germany, the EU, and the US dropping significantly compared to November 2023, as goods remained at sea due to delayed deliveries.

Impact on Shipping Costs

Increased Travel Time and Distance Rerouting around the Cape of Good Hope makes journeys significantly longer, increasing travel time and distance. This route is about 53% longer, requiring cargo ships to cover an additional 4,575 nautical miles (a 29% increase). Journeys to North Atlantic and Northern European destinations now take an extra 12-14 days at sea.

For example, a journey from Shanghai to Rotterdam takes approximately 35 days and spans 13,800 nautical miles, compared to about 27 days and 10,600 nautical miles via the Suez Canal. Approximately 60% of the world's containerized trade has experienced longer transit times and delayed deliveries.

Soaring Fuel and Freight Rates More days at sea and longer distances directly translate to higher costs. Fuel consumption can increase by 30% compared to the Suez Canal route, adding an estimated USD1 million in fuel costs for each round trip from Asia to Europe.

Freight rates have risen due to increased operating expenses, elevated port charges, and the escalating costs of complying with environmental regulations. The rerouting has led to a hike in freight rates of as much as USD1,000 per twenty-foot equivalent unit (TEU), and these prices are expected to remain high. The Drewry World Container Index (WCI) rose 197.8% from August 2023 to August 2024.

Higher Insurance Premiums

The cost of insuring ships transiting the Red Sea has more than doubled since early September 2024, surging from approximately 0.7% to as much as 2% of the vessel's value.

Before the conflict, the war risk insurance premium stood at about 0.05%. Many smaller insurers are now hesitant or outright refusing to provide war coverage, posing significant challenges for shipowners. Sanctions and geopolitical tensions have also made insuring vessels linked to countries like the US, UK, and Israel more complex.

Impact on Commodity Prices

Rising transport costs have created economic disturbances, elevating expenses and reducing demand, which can lead to lower prices for manufacturers in exporting countries.

This also reduces trade volume, causing greater price fluctuations. Countries heavily reliant on food imports are particularly vulnerable, with the number of people suffering food insecurity increasing from 113 million in 2018 to 282 million in 2023.

Oil tanker transits through the Suez Canal decreased by 23% from November to December 2023, with LPG and LNG carrier transits falling by 65% and 73% respectively. The longer route for tankers adds 20-45 days, increasing tanker rates, fuel costs, and arrival delays, thereby driving up energy prices.

Impact on the Environment

The rerouting of ships around the Cape of Good Hope has significantly increased CO2 emissions. Shipping accounts for almost 3% of global emissions, and the longer distances traveled by rerouted vessels lead to increased fuel consumption.

This has contributed to higher greenhouse gas emissions, rising from 210 million tonnes in 2013 to 231 million tonnes in 2023. Increased sailing distances result in a 1:1 increase in emissions if the same vessels operate at the same speed.

Specific incidents have also caused environmental damage, such as the sinking of the Rubymar in February 2024, which caused a 29-kilometer oil slick in the Red Sea.

Military response and its effectiveness?

>The current military response to the Red Sea crisis involves a multinational effort aimed at defending commercial shipping and degrading Houthi capabilities. However, recent events suggest a renewed and deadly campaign by the Houthis, raising questions about the long-term effectiveness of these responses.

Here's a breakdown of the military response and its effectiveness:

1. Overview of Military Operations:

Operation Prosperity Guardian

The United States announced this international military coalition in December 2023, involving more than 20 countries, with the goal of defending the Red Sea from Houthi attacks. The US considers these attacks a direct threat to international commerce and maritime security.

Operation Aspides

The European Union (EU) launched its own maritime security operation, Aspides, in February 2024, specifically to protect merchant shipping in the Red Sea and surrounding waters. This operation is headquartered in Larissa, Greece, and is not permitted to attack preemptively; it will only fire if attacked first and operates only at sea, without conducting military strikes on land.

Support and Participation

The US and the United Kingdom carried out five joint naval and airstrikes between January 11 and May 30, 2024, in response to continued Houthi aggression. These strikes targeted 28 locations in Yemen with over 150 weapons.

Countries such as Australia, Bahrain, Canada, Denmark, the Netherlands, and New Zealand supported the US/UK actions non-operationally.

The Indian Navy has also stepped up its Red Sea patrols and deployed a maritime patrol aircraft along with five guided missile destroyers.

Additional military actions include operations to uphold the principle of freedom of navigation and degrade Houthi capabilities to attack international shipping and coalition warships.

2. Israeli Military Response:

The Israel Defense Forces (IDF) has launched its own direct strikes against Houthi targets in Yemen. On July 6, 2025, for example, IAF fighter jets struck and destroyed "terror infrastructure" belonging to the Houthi "terrorist regime," including the ports of Al Hudaydah, Ras Isa, and Salif, and the Ras Kanatib power plant.

The IDF also targeted the Galaxy Leader, a commercial vessel seized by the Houthis in November 2023, which the IDF stated the Houthis were using as a radar platform to track shipping.

These Israeli strikes are carried out in response to repeated Houthi attacks against Israel, its civilians, and civilian infrastructure, including the launching of Unmanned Aerial Vehicles (UAVs) and surface-to-surface missiles.

In June 2025, Israeli Navy Sa'ar 6-class corvettes carried out the first Israeli naval strike on the Houthis, targeting the Hudaydah Port with two long-range guided missiles.

3. Effectiveness and Challenges:

Periods of Relative Quiet and Renewed Attacks:

The Houthi shipping attacks initially began in November 2023, leading to "nearly constant military engagements" with the US and its allies.

A ceasefire was reached in May 2025, leading to "months of relative quiet". During this time, shipping through the Red Sea, while still lower than normal, had reportedly increased.

However, the recent attacks on the Liberian-registered Magic Seas on July 6, 2025, and the Greek-owned Eternity C on July 7, 2025, mark a significant re-escalation.

The Magic Seas was hit with drone boats, rocket-propelled grenades (RPGs), and small arms fire, subsequently sinking. The Eternity C attack killed three mariners and wounded two, highlighting "the danger of the group’s renewed campaign".

These attacks are the first major commercial ship attacks since December or January, contradicting the assumption that "things were cooling off".

Houthi Motivation and Tactics:

The Houthis claim these attacks are in support of Palestinians in the ongoing war between Israel and Hamas.

Under the terms of the ceasefire brokered with the US, the Houthis reportedly promised not to target US vessels, but "never said a word about anyone else". This loophole means non-American ships remain "fair game" under Houthi logic.

Houthi attacks are described as "coordinated tactical disruption" using swarm tactics with skiffs followed by explosive drone boats (USVs), a playbook used in over 100 incidents since October 2023. They possess a range of advanced weapons, including ballistic missiles, cruise missiles, sea-to-sea missiles, and attack/suicide UAVs, which they largely receive from Iran. These attacks also serve as operational tests for new Iranian weapons and to survey Israeli defense tactics.

Impact on Global Trade and Perception of Security:

The attacks have forced many shipping companies to reroute vessels around Africa via the Cape of Good Hope, adding significant costs, increasing inflation, and exacerbating food insecurity globally.

Shipping insurance costs for transiting the Red Sea have surged, more than doubling from approximately 0.7% to as much as 2% of the vessel's value. Some smaller insurers are even refusing to provide war coverage.

The recent attacks "tarnish the U.S. claims that Operation Rough Rider had brought calm to the Red Sea". Analysts note that the Houthis are "back with a bang," and the attacks "challenge the security of an entire route" and "test the will of the international community".

The vulnerability of maritime trade is underscored, and if non-US commercial ships continue to be targeted, the scope of the international military mission "may have to expand," which implies further escalation.

Casualties and Damages:

Between November 2023 and January 2025, the Houthis targeted more than 100 merchant vessels, sinking two and causing the death of four mariners. The recent Eternity C attack killed three more mariners and wounded two. Many other vessels have been damaged, and crews held hostage after a ship was seized.

In conclusion, while significant military resources have been deployed and actions taken, including joint airstrikes and naval patrols, the Houthis demonstrate continued capabilities and a willingness to escalate attacks, particularly against non-US vessels, thereby maintaining disruption to global trade and maritime security.

The effectiveness of the military response is challenged by the Houthis' persistent threat and their strategic use of the attacks as a political message.

Red Sea crisis chronology and geographical facts

The Red Sea crisis has undergone significant evolution both chronologically and geographically since its inception. The crisis, largely driven by the Houthi rebels in Yemen, has profoundly impacted international maritime trade, leading to increased costs, rerouted shipping, and military engagements.

Inception and Early Escalation (October – December 2023)

The crisis formally began on October 19, 2023. Houthi attacks on commercial shipping in solidarity with Palestinians in the Israel-Hamas war commenced in November 2023.

October 2023:

Initial Houthi actions included firing loitering munitions and missiles from the southern Red Sea towards Israel, with some being intercepted by Israeli air defenses near Eilat, including the first use of the Arrow and Arrow 3 systems in the Gaza war. An F-35i Adir jet also intercepted a cruise missile.

November 2023:

The Houthis escalated their campaign by hijacking the Liberian-registered Galaxy Leader cargo vessel in the southern Red Sea on November 19, rerouting it to Yemen's Hodeidah port and taking its crew hostage. They later installed a radar system on the ship to track international shipping. Other vessels, such as the CMA CGM Symi and Central Park, were also targeted. A US MQ-9 Reaper drone was shot down off Yemen.

December 2023:

Attacks became more frequent, with multiple commercial ships like Unity Explorer, Number 9, and Sophie II being hit by missiles. Other notable incidents included attacks on the Norwegian tanker Strinda and the Maersk Hangzhou, the latter resulting in the first Houthi casualties. The US Navy also actively engaged, with USS Carney shooting down 14 Houthi UAVs.

Geographical Focus:

The initial attacks primarily targeted vessels in the Red Sea, Gulf of Aden, and those heading towards Eilat, Israel.

Initial Impact: By December 21, 2023, Israel's Eilat Port experienced an 85% drop in activity. Most shipping companies began rerouting vessels around Africa via the Cape of Good Hope, leading to significantly increased costs and adverse effects on the global supply chain, contributing to inflation and food insecurity.

International Response and Sustained Disruption (Late 2023 – Early 2025)

The escalating attacks prompted a robust international military response.

December 2023:

The US announced Operation Prosperity Guardian, an international military coalition involving over 20 countries, aimed at defending the Red Sea from Houthi aggression. India also launched Operation Sankalp for maritime security.

January 2024:

The US and UK carried out joint naval and airstrikes against Houthi targets in Yemen, starting January 11, in response to intensified Houthi attacks. The EU launched its own maritime security operation, Aspides, in February 2024. Despite these operations, several ships, including the first US-owned vessel (Gibraltar Eagle), continued to be struck.

Impact on Shipping:

By March 2024, maritime traffic through the Suez Canal and Bab-el-Mandeb Strait had halved, while traffic via the Cape of Good Hope doubled.

This rerouting added significant travel time (e.g., 12-14 extra days for Asia to Northern Europe) and costs (a 30% increase in fuel consumption, adding $1 million per round trip from Asia to Europe).

Freight rates surged dramatically, with the Asia to Mediterranean route seeing a 412% increase since October 2023, and global container index rising 197.8% from August 2023 to August 2024. War risk insurance premiums also climbed substantially, from approximately 0.05% to 0.75-1% of a vessel's value.

Houthi Tactics:

The Houthis continued to employ a diverse arsenal, including ballistic missiles, cruise missiles, anti-ship missiles, and attack and suicide drones (UAVs and USVs).

Their tactics often involved using skiffs for initial engagement, followed by explosive drone boats as the "killing blow".

These drone boats are described as cheap, low-profile, and difficult to intercept. The Houthis also claimed to have acquired "submarine weapons".

Geographical Expansion:

While primarily focused on the Red Sea and Gulf of Aden, the Houthis demonstrated an extended range with attacks reaching the Indian Ocean by April 2024 and claiming targets in the Mediterranean Sea in May 2024.

Resumption of Attacks on Commercial Shipping (May – July 2025)

After a period of relative quiet, attributed to a ceasefire brokered in May 2025 where the Houthis pledged not to target US vessels, the crisis saw a renewed and deadly escalation.

July 6, 2025:

The Liberian-registered, Greek-owned bulk cargo vessel Magic Seas was attacked with multiple explosive-laden drone boats, rocket-propelled grenades, and small arms fire.

The ship caught fire, sustained severe damage, and its crew abandoned ship. This marked the first major commercial ship attack since December (or January depending on source's wording) after months of calm, and it occurred as the ceasefire only applied to American targets.

July 7, 2025:

The Liberian-flagged bulk carrier Eternity C was also attacked, resulting in three mariners killed and two injured. Both Magic Seas and Eternity C were connected to fleets that had previously called at Israeli ports. These attacks immediately drew international condemnation.

Israeli Retaliation:

In response to these renewed attacks, the Israel Defense Forces (IDF) launched Operation Black Flag on July 6, 2025, conducting extensive overnight airstrikes against Houthi targets in Yemen.

These targets included the ports of Al Hudaydah, Ras Isa, and Salif, and the Ras Kanatib power plant. The IDF also specifically targeted the hijacked Galaxy Leader, which the Houthis were reportedly using as a radar platform to track shipping.

Geographical Focus:

The renewed attacks in July 2025 are again concentrated in the Red Sea, specifically near the Bab al-Mandeb Strait and the Yemeni port of Hodeidah.

The Red Sea crisis has evolved from initial probing attacks to a full-blown maritime conflict, forcing significant changes in global shipping routes and operations.

Despite international military efforts and periods of negotiated quiet, the Houthis have demonstrated persistence, adaptability in tactics, and a willingness to resume attacks on commercial shipping, including those from non-US flagged vessels.

The underlying motivations remain linked to their support for Palestinians and their broader geopolitical objectives backed by Iran.