Commodities
Houthi Advance Gives Iran Leverage Over Gulf States
The Houthi capture of Yemen's Red Sea coastline has significantly altered the balance of power in the Gulf, strengthening Iran's hand and forcing Saudi Arabia and its neighbors to confront a difficult choice: absorb growing economic costs or seek accommodation with Tehran.
By securing a position overlooking Bab el-Mandeb, one of the world's most important shipping arteries, the Iran-aligned Houthi group has opened a second pressure point, threatening Saudi oil exports diverted from the Strait of Hormuz.
The calculation is straightforward: by threatening Red Sea shipping while Iran chokes off Hormuz, Tehran and the Houthis can raise oil prices and fuel inflation, narrowing the region's prospects of relying on Washington to resolve the crisis.