Caught between the Red Sea and Houthi rebels, US running out of options

Yemen's Houthi rebels have intensified their attacks in the Red Sea, striking a nerve in the United States' strategic efforts to secure maritime routes in the region.

In the past week alone, the Iran-allied faction targeted a Marshall Islands-flagged oil tanker en route to the vital Suez Canal following an attack on a Norwegian tanker that the Houthis claimed was transporting crude oil to Israel.

On Thursday, the Houthis fired another missile at a container ship in the Bab el-Mandeb strait, connecting the Red Sea and the Gulf of Aden.

These escalating incidents have heightened tensions in a significant global shipping route, through which around 10 percent of worldwide trade, or around $1 trillion worth of goods, passes annually.

When the US Navy intervened to protect the Marshall Islands-flagged tanker, the Houthis launched two missiles at an American warship that missed the target. In response, the US shot down what it referred to as an "aerial vehicle".

Emphasising the Houthis' goals, Mohammed Ali al Houthi, the leader of the faction's supreme revolutionary committee, warned commercial ships not to travel to Israel and advised vessels passing Yemen to maintain active radios and promptly respond to any communication attempts.

He also warned cargo ships against "falsifying their identity" or flags different from those of the country of the shipowner.

The Houthis, initially demonstrating solidarity with the Palestinians by firing missiles and drones into southern Israel during the bombardment of Gaza, have certainly irked Tel Aviv.

Indeed, some Israeli cargo ships have been diverted from their usual Red Sea route to a longer journey through the Mediterranean Sea, around Africa, and onward to the Indian Ocean. Expressing Israel's frustration, President Isaac Herzog said the Houthis have "crossed a red line in the Red Sea" and advocated an "international coalition" to counteract their actions.

The situation has also triggered a rise in shipping costs through the Red Sea. While broader economic effects are currently limited, it poses questions over how prepared the US is for this unprecedented projection of Houthi influence in a region it has traditionally sought to securitise.

A new challenge

To be clear, the Houthis' targeting of Israel is arguably partly aimed at domestic consumption, as the rebel group seeks control over northern Yemen, and discontent may arise over the lack of services in war-battered Yemen.

Nonetheless, its growing clout in the Red Sea has proven a challenge for regional security.

Besides the Houthis, other groups supported by Iran have shown intentions to confront US naval forces. In a statement in early November, Hezbollah's leader, Hassan Nasrallah, alluded to his group's advanced anti-ship missiles while addressing the American naval deployment in the Eastern Mediterranean during the same period.

So, what are the US' next steps from here?

Last week, it emerged that US officials were discussing the prospect of military action with unnamed Gulf states, likely Saudi Arabia and the United Arab Emirates (UAE), given their past involvement in Yemen.

These suggestions hint that the US could retreat to familiar strategies in the region. Indeed, the US, in part, backed the Saudi-led coalition's efforts to restore a friendly Yemeni government for regional and Red Sea security.

Despite speculation over renewed intervention, Yemen's war has died down, and Saudi Arabia no longer wants to be involved in a war there. After all, its main priority is developing its vast economic transformation towards its Vision 2030 ambitions and would therefore want to avoid a breakdown of the UN-led diplomatic measures since 2022.

While it had intercepted Houthi missiles fired towards southern Israel through its own borders in October, this can be seen more as a message that it won't accept violations of its own airspace.

Considering the past failures of the war in Yemen, which saw the Houthis transform from a small actor to a de-facto power in north Yemen, withstanding the Saudi Arabia-led airstrikes campaign, any joint military coordination would likely yield no positive results. Such moves would, therefore, likely be off the table, including airstrikes on Houthi positions from the US or its Gulf partners.

Additionally, the Houthis have still shown relative restraint in targeting American positions so far, compared to, say, Iran-backed factions in Iraq that have clashed with US forces since October 7.

They have avoided targeting US military assets in Djibouti, across the Red Sea, indicating that they themselves may be cautious about the costs of a bigger conflict.

Limited options

There is a distinct possibility that Washington simply cannot end the Houthis' threat in the long term. Indeed, despite having past military success against militia groups and nation-states in the Middle East, the Houthis are effectively a hybrid of both a militia and nation-state in northern Yemen, which the US has limited options to deal with.

So, this raises the question of other options: will the US pursue other ways to pressure the faction?

The Biden administration has considered re-designating the Houthis as a "terrorist organisation", which it lifted in 2021 after Donald Trump initially implemented it. This would also likely prove ineffective, given the Houthis have adapted to sanctions in the past and built up their own independent financial networks to enable their rule and expansion.

For now, Washington continues to adopt its traditional 'containment' approach. It's in talks to form the "broadest possible" naval task force with global partners, including the UK, France, and Israel. While this may curtail Houthi attacks, it also carries the risk of inflaming regional tensions.

Iran has already criticised the move, warning that such a formation could lead to "extraordinary problems." Additionally, the Houthis themselves may hope to sabotage this effort.

Crucially, Saudi Arabia and the UAE have approached such developments with caution, as they would bear the brunt of any further escalation.

After all, both nations have experienced Houthi missile and drone attacks during the later stages of Yemen's war, including strikes on a Saudi oil facility in 2022. Moreover, Saudi Arabia has urged US restraint in responding to the Houthis, signalling it may continue pushing Washington to avoid a confrontation.

Growing rifts

As tensions rise, disagreements between Washington and its traditional Gulf state partners are beginning to surface. On the one hand, after violence erupted between Israel and Hamas on October 7, some of America's Arab allies sought protection under the US' extensive security network as fears of an outbreak of a regional war loomed.

However, rifts are palpable between the US and Arab states' conflicting stances over calls for a ceasefire in Gaza.

While the Gulf states have called for an immediate end to the violence in Gaza, the Houthi threat arguably presents a more pressing security challenge to Riyadh and Abu Dhabi, likely inclining them towards a diplomatic solution to the crisis.

These emerging disagreements are further amplified in Riyadh and Abu Dhabi's recent attempts to double down on exploring deeper partnerships with Russia and China, despite US attempts to pressure them against this.

Vladimir Putin's recent visit to the UAE and Saudi Arabia, advancing what he called their "friendly relations," coupled with China and Saudi Arabia commencing joint naval exercises on October 10, are further indicators of an evolving geopolitical landscape.

While maintaining a massive military budget and traditionally acting as a security provider in the Gulf region, garnering support from its regional partners, recent developments highlight some shortcomings in its strategic influence. A diplomatic resolution to this new challenge seems preferable, but it appears dependent on de-escalation elsewhere, namely the Gaza war.

Whether Washington opts for less forceful measures or not, this new challenge reveals limitations in adopting its traditional playbook.