Yemen’s Struggle for Bab el-Mandeb Could Reshape Global Shipping

The Strait Is Back in the Crosshairs

The Bab el-Mandeb strait — the narrow waterway that connects the Red Sea to the Gulf of Aden and sits as the southern gateway to the Suez Canal — is once again a battlefield. On September 25, what began as a Houthi celebration of the Prophet Muhammad’s birthday in Sana’ turned into a proxy flashpoint. Houthi fighters, who had spent months consolidating control over western Yemen, moved toward the strait. Yemeni government forces intercepted them. Within a single day, at least 129 people were killed: 66 government soldiers and 62 Houthi fighters, according to AFP and Xinhua citing military and medical sources on both sides. One civilian died. It is the deadliest single engagement in western Yemen in years.

But the casualty count tells only half the story. The real story is what this fighting means for the 12 percent of global trade that passes through Bab el-Mandeb every year, and for the energy markets that depend on it.

Why This Strait Still Matters

Bab el-Mandeb is 30 kilometers wide at its narrowest point. It is one of the world’s three most critical shipping chokepoints, alongside the Strait of Hormuz and the Suez Canal itself. Nearly all oil and liquefied natural gas (LNG) moving from the Persian Gulf to Europe and North America transits this route. In normal times, about 3.5 million barrels of oil per day flow through it. When it is disrupted, the ripple effects are immediate.

The last major disruption came in late 2023, when Houthi attacks on commercial vessels in the Red Sea forced major shipping lines like Maersk and MSC to reroute around the Cape of Good Hope. The detour added roughly 10 to 14 days to transit times between Asia and Europe. Insurance premiums for Red Sea voyages spiked 300 to 500 percent. A container that normally cost $4,000 to ship from Shanghai to Rotterdam exceeded $10,000 at the height of the crisis. Inflation hit European consumers hardest, particularly in sectors reliant on just-in-time supply chains.

This time, the threat is different. It is not just missiles fired from Houthi positions inland. It is a ground war for control of the strait itself. If either side secures the coastline, they gain the ability to monitor, tax, or block shipping far more effectively than long-range strikes alone.

Who Controls the Strait Controls the Lever

The Houthi movement, officially known as Ansar Allah, has long viewed Bab el-Mandeb as strategic territory. During the 2015–2022 period of the Saudi-led coalition’s intervention in Yemen, the Houthis captured the port of Hodeidah and the nearby islands of Perim and Kamaran — positions that gave them leverage over Red Sea traffic. They used that leverage repeatedly: attacking Saudi and UAE-linked vessels, mining approaches, and firing drones at commercial ships.

The current fighting suggests the Houthis are pushing again to reassert that control. Government forces, backed by the internationally recognized Yemeni administration and quietly supported by the UAE and others, are trying to prevent a Houthi monopoly on the strait. The question is not whether either side will win outright — Yemen’s civil war has no clean victor — but who can impose enough cost on commercial shipping to make navigation through Bab el-Mandeb commercially unviable.

The Suez Route Is Already Fragile

Here is what many English-language readers may not fully appreciate: the Suez Canal route is not a stable default anymore. Before 2023, it carried roughly 12 to 15 percent of global container traffic and about 7 percent of global oil trade. Since the Houthi campaign intensified, a significant portion of that volume has shifted to the Cape route, and some cargo has been diverted to the Trans-Siberian Railway or to Middle Eastern gateways like Djibouti and Jubba.

But none of those alternatives have the same capacity. The Cape adds fuel costs and delays. The rail route handles negligible container volumes. The African port diversions are still scaling up. For bulk carriers — the tankers and gas carriers that move the energy goods underpinning European industry — there is truly no substitute for the Suez-Bab el-Mandeb corridor.

If ground fighting around the strait intensifies further, two scenarios become plausible. First, a targeted escalation similar to late 2023, where Houthi forces use coastal positions to threaten shipping and force rerouting. Second, a more sustained closure, whether de facto through intimidation of captains or de jure through mined waters. The latter is less likely — no actor wants to bear full responsibility for a Suez Canal shutdown — but the risk is rising.

Insurance Markets Are Already Pricing Risk

The Lloyd’s of London war risk insurance market does not wait for battles to begin before adjusting premiums. Even before this latest clash, Red Sea war risk rates were elevated compared to the pre-2023 baseline. The death toll of 129 in a single engagement will prompt another repricing cycle. Shipowners chartering through the Red Sea will face higher premiums, and those costs will be passed through freight rates.

For shippers of petroleum products, the math is stark. AVL (Average Vessel Loss) and hull and machinery insurance premiums for war-risk zones have historically climbed 20 to 40 percent during active conflict periods in the Red Sea. If the fighting around Bab el-Mandeb persists for more than a few weeks, expect another wave of rate increases. The question is whether the market has already absorbed the first increase from 2023–2024 or whether insurers are nearing their risk limits for this corridor.

The Energy Angle

Europe’s energy security depends heavily on LNG imports from Qatar and other Gulf suppliers. Most of that LNG travels through the Strait of Hormuz and then the Red Sea to reach European terminals in Spain, France, and the Netherlands. Any disruption to Bab el-Mandeb would directly affect the supply chain for these deliveries. The UAE’s Fujairah terminal on the Gulf of Oman side offers an alternative, but its capacity is limited and its throughput is already maxed out for existing contracts.

China is the other major consumer watching closely. Chinese oil imports from the Middle East account for roughly 70 percent of Beijing’s total crude imports, and nearly all of it transits Bab el-Mandeb. Beijing’s response to the 2023 Houthi attacks was notably quiet — a reflection of its pragmatic calculus. But if the strait were fully closed, Chinese refiners would feel the pain within weeks. That would change Beijing’s posture dramatically.

What Happens Next

The immediate concern is whether the fighting will expand beyond the Sana–Bab el-Mandeb corridor into the coastal cities of Taiz and Hodeidah. Hodeidah is Yemen’s largest port and the primary entry point for humanitarian aid. If fighting reaches its outskirts, the port’s operations could be disrupted, creating a dual shock: reduced commercial throughput and a humanitarian crisis.

The secondary concern is the Iranian dimension. The article notes that the Houthi offensive follows from the July airport strike in Sana’, which the Houthis blamed on Saudi Arabia after an Iranian aircraft landed there. Iran’s role in supplying the Houthis is well documented, and any escalation that pulls Iran more directly into the conflict would widen the geographic scope of the crisis from the Red Sea to the Strait of Hormuz itself.

The third concern is regional spillover. Djibouti hosts military bases for the United States, China, France, Japan, and Italy — all of which have a direct interest in keeping Bab el-Mandeb open. A full closure would trigger coordinated naval responses, possibly resembling the Combined Task Force 150 operations seen in previous years. But those operations were designed to deter piracy, not to guarantee passage through an active warzone.

The Bottom Line

The 129 deaths in this latest clash are a human tragedy and a strategic warning. The Bab el-Mandeb strait is not a peripheral conflict zone. It is a central node in the global trading system. When ground fighting moves into its vicinity, the consequences extend far beyond Yemen’s borders — to European energy prices, to Asian manufacturing costs, to the insurance bottom lines of every major shipping company. The world may not notice immediately. It always notices when the bills come due.