I. When a cruise missile caused the M/V Minervagracht to go up in flames earlier this October, governments, shipping companies, and oil traders alike were reminded that the Red Sea is still not secure. Since the end of 2023, the Houthis have turned the Red Sea into a shipping nightmare, leading many companies to send their ships around Africa’s Cape of Good Hope — safer, although less efficient. Following the ceasefire agreement between Israel and Hamas, Houthi attacks have ceased; however, the damage has been done. Israel and the Houthis may have unfinished business, and with recent ceasefire violations by Israel in Gaza, there is no telling if and when the Yemeni group will resume attacks. The shipping industry remains skeptical of a return to normalcy, and regional economies continue to feel lingering effects, leaving global markets uncertain and the Red Sea’s future stability in doubt (LaRocco 2025).

II. Ansar Allah, also known as the Houthis, is an Islamist political and military organization founded and based in Yemen. Originally started in the 1990s as the Believing Youth, the movement sought to revive Zaydism—a branch of Shia Islam historically dominant in northern Yemen that emphasizes resistance to unjust rulers and permits armed revolt under certain conditions (Britannica Editors n.d.). This tradition of political activism and local religious identity contributed to the Believing Youth’s radicalization following the 2003 United States invasion of Iraq. Since then, the group has been in on-and-off conflict with the internationally recognized Yemeni government, other Arab countries of the Persian Gulf, Israel, and the United States. As of today, the Houthis control the nation’s capital, Sanaa, in addition to Yemen’s north-west. Control of the northwest provides access to the Red Sea coastline, from which the movement launches its attacks. The Houthis’ attack capabilities are made possible through their membership in Iran’s “Axis of Resistance” and funding from Iran. On a regional scale, the Houthis' fighting for full control of Yemen ties into the greater Shia-Sunni proxy war being waged by Saudi Arabia and Iran (BBC News 2025).

III. The Red Sea is one of maritime shipping’s focal points, connecting the Indian Ocean to the Mediterranean Sea via the Suez Canal. Since the construction of the Suez Canal in 1869, the Red Sea’s importance to world markets has greatly increased, accounting for 30% of container shipping, 9% of seaborne oil, and 8% of liquefied natural gas (LNG) —12-15% of global trade. Following Israel’s extensive military response in Gaza in the wake of October 7, Houthi rebels began attacking ships linked to Israel, framing the attacks as a form of protest. Since November 19, 2023, the militant group has carried out 346 naval operations and targeted 228 ships across the Red Sea, Bab al Mandab, the Gulf of Aden, and beyond—setting their sights further than just on Israeli vessels (Toomey 2025).

IV. Governments have not taken the shipping disruption very well. At the end of 2023, a coalition of countries, led by the U.S., was carrying out retaliatory strikes against the Houthis' drone and missile infrastructure in Yemen. This military operation, known as Operation Prosperity Guardian, proved to be much more complicated than previously anticipated. The Houthis kept Western forces locked into a nearly two-year-long military intervention, which became the United States’ single longest naval engagement since World War II. With advanced air defense resources stretched thin as a result of U.S. contributions to Ukraine and Taiwan, in addition to the American Navy launching countless missiles to neutralize Houthi attacks, Red Sea intervention has not come at a low cost. Surface-to-air missiles used by the Navy include SM-2 and SM-6 types—costing around $2.5 million and $4.3 million per unit, respectively (Trevithick 2024). The high cost disparity between American-made munitions and inexpensive Iranian-made drones or former Yemeni government stockpiles, coupled with the Houthis undermining the May 6 ceasefire with the U.S., has led to genuine concerns over American deterrence capabilities and naval supremacy (Toomey 2025). 

V. While Operation Prosperity Guardian aimed to contain Houthi aggression, the Houthis’ continued attacks have sent ripples across world markets, causing a number of negative implications that persist today. The Red Sea has seen shipping traffic drop by as much as 60% in recent months, as companies shift operations to the longer but safer Cape of Good Hope, a move that has driven up freight shipping prices. Given the unpredictable security situation in the Red Sea, war risk premiums have risen over the past two years, contributing to higher shipping prices as voyages become costlier for the remaining ships sailing the area (Freightos 2025). While the Cape of Good Hope offers a safer alternative, trips between Asia and Europe take up to two weeks longer, leading to higher fuel costs and reduced global shipping capacity. Additionally, the Egyptian economy has suffered greatly, with the country’s Suez Canal Authority losing approximately $7 billion in toll revenues in 2024. Canal tolls make up 15% of Egypt’s foreign currency income and 10% of gross domestic product, meaning the Arab nation has noticeably felt the impact of toll revenue loss (Chirls 2025). These economic disruptions display not only the vulnerability of global commerce but also the Houthis’ growing geopolitical influence over a critical maritime chokepoint.

VI. The crisis in the Red Sea has shown that maritime disruptions can have extensive economic and strategic consequences. A non-state actor has emerged and demonstrated its capabilities in defying major powers and destabilizing global trade with limited resources. The Houthis were able to challenge Israel, withstand a coalition of Western powers, and even managed to disrupt global shipping for almost two years. Unlike other insurgent groups that have historically operated on land, the Houthis exerted influence across borders and into open waters. Their rise marks a turning point in regional power dynamics, demonstrating that Iran’s “Axis of Resistance” remains resilient–even as Hezbollah, Hamas, and the Assad regime face military and political setbacks. For the West, this conflict has highlighted the growing costs of maintaining military supremacy in an era of asymmetric warfare. Going forward, American policymakers and defense officials may need to rethink how they engage militant groups operating within their home regions to avoid future prolonged and costly conflicts.

Sources Consulted
BBC News. 2025. “Who Are the Houthis and Why Is the US Targeting Them?” BBC News, March 25, 2025. https://www.bbc.com/news/world-middle-east-67614911. 

Toomey, Bridget. 2025. “Houthis Signal Pause on Attacks on Israel After Gaza Ceasefire, Detail Attacks During the Conflict.” Foundation for Defense of Democracies, October 16, 2025. https://www.fdd.org/analysis/2025/10/16/houthis-signal-pause-on-attacks-on-israel-after-gaza-ceasefire-detail-attacks-during-the-conflict/. 

Henley, Cameron, and Cameron Keyani. 2024. “The Houthis, Operation Prosperity Guardian, and Asymmetric Threats to Global Commerce.” Center for Maritime Strategy, July 18, 2024. https://centerformaritimestrategy.org/publications/the-houthis-operation-prosperity-guardian-and-asymmetric-threats-to-global-commerce/. 

Britannica Editors. n.d. “Zaydiyyah.” Encyclopaedia Britannica. Accessed October 2025. https://www.britannica.com/topic/Zaydiyyah. 

Trevithick, Joseph. 2024. “Replenishing Missiles Used To Down Houthi Threats Will Require Extra Funding.” The War Zone, March 12, 2024. https://www.twz.com/news-features/replenishing-missiles-used-to-down-houthi-threats-will-require-extra-funding. 

LaRocco, Lori Ann. 2025. “Israel-Hamas Ceasefire Will Not Bring Global Freight Fleet Back to Red Sea Quickly.” CNBC, October 13, 2025. https://www.cnbc.com/2025/10/13/israel-gaza-ceasefire-red-sea-freight-containerships.html. 

Chirls, Stuart. 2025. “Gaza Plan to Boost Suez Shipping Recovery in 2025.” FreightWaves, October 7, 2025. https://www.freightwaves.com/news/gaza-plan-to-boost-suez-shipping-recovery-in-2025. 

Freightos. 2025. “Freightos Baltic Index (FBX).” Accessed October 2025. https://www.freightos.com/enterprise/terminal/freightos-baltic-index-global-container-pricing-index/.