Worsening maritime security situation in the Bab Al Mandeb Strait

Saudi Arabia, the world’s largest crude exporter, has suspended all its oil shipments through the Bab Al Mandeb Strait at the southern tip of the Red Sea, following an attack on two vessels by Yemeni Houthi fighters. This briefing note assess how the ongoing conflict in Yemen impacts the region’s maritime and oil and gas operations.

27th July 2018: Iran-backed Houthi militants reportedly targeted two vessels belonging to the Saudi Arabian National Shipping Company with surface-to-surface missiles off the western coast of Yemen. The Saudi-led military coalition in Yemen has confirmed the attack, stating an “oil tanker suffered minor damage and the militia [Houthis] almost caused an environmental disaster.” In response, Saudi-Energy Minister, Khalid Al Falih, said his country will halt oil shipments through the Bab Al Mandeb Strait with immediate effect. The Bab Al Mandeb Strait connects the Red Sea with the Gulf of Aden, and is one of the world’s major waterways for crude oil and other petroleum product tankers. While Houthi militants based in Yemen have targeted vessels transiting along Yemen’s west coast on a number of occasions since 2017, this marks the first time they have forced Saudi Arabia to significantly alter its commercial operations.

Yemen’s Civil War: Where do things stand?

Over the past six months, the Saudi Arabia-led coalition, which includes United Arab Emirates, Kuwait and Bahrain, have capitalised on its military advancements on the west-coast of Yemen. The recent major military offensive to recapture the strategic-Houthi-controlled city of Hodeidah in mid-June 2018 represents a significant development in the dynamics of the Yemeni civil war, as its port is a major Houthi-supply point, and by proxy, an asset for Iran. The associated intensified fighting along Yemen’s west coast has notably increased threats to maritime activity. The Houthis, who have Iranian backing, have sought to use the threat to shipping as a means to gain leverage over their militarily superior coalition enemies. Since May 2018, five attacks, including the use of water-borne improvised explosive devices (WBIED), have been reported off the coast of Hodeidah, as far as 70nm offshore.

What are the implications?

As the conflict in Hodeidah Governorate escalates, the threat to maritime operations will consequently increase. In January 2018, Houthi officials threatened that they would block the Bab Al Mandeb strait, and close Hodeidah Port, to force the coalition to stop its airstrikes on Yemen. If Houthis continue in their escalation of hostilities on maritime activities, this could potentially cause a full closure of the waterway, at least until international navies are able to guarantee safety of transiting vessels. Furthermore, there have been various reports suggesting that Houthis have planted sea and land mines along Yemen’s coast, and could deliberately destroy critical infrastructure as part of a ‘scorched earth’ tactic. Sea mines have been used to deter and deny Saudi-led coalition forces access to key ports, and is likely to affect commercial ships using these ports, or transiting near the Yemeni coastline.

Any hostile sea presence in Yemen could threaten traffic at Bab Al Mandeb and the Suez Canal, as well as a daily flow of oil and petroleum products. Additionally, the potential closure of Bab Al Mandeb, through Houthi attacks or a navy-enforced blockade, can lead to increases in total energy costs and global energy prices. An estimated 4.8 million barrels per day (bpd) of crude oil and refined petroleum products are transported through the waterway to Europe, the United States, and Asia. However, despite the political significance of Saudi Arabia’s decision, it has alternatives to the Bab Al Mandeb, including an east-west pipeline that exports from Yanbu on the Red Sea coast. As such, the impact of Saudi Arabia’s decision on crude prices has, so far, been marginal.

What happens next?

While Saudi Arabia is justifiably concerned about the safety of its vessels transiting along Yemen’s coast, the halt of oil shipments is largely symbolic and for propaganda purposes. This is aimed at attracting international support for the coalition’s military intervention in Yemen. The perceived threat to global energy supplies can provoke a response by external powers, in a bid to assist Saudi Arabia and the UAE in defeating the Houthis. It will also enable the Saudi-led coalition to posture as the defender of international trade; a political win in both its war in Yemen, and the wider regional rivalry with Iran.  Nonetheless, it is likely that intermittent skirmishes between Houthi militants and coalition forces, as well as offshore attacks on vessels, will continue in the short term, despite UN Special Envoy Martin Griffiths’s attempts at facilitating peace talks. While the coalition is unlikely to succeed completely its efforts to pacify the Houthi threat to maritime activity, Houthis are also unlikely to expand attacks on non-coalition vessels, at least deliberately, lest it invites a more robust international military intervention.

  • The Bab Al Mandeb Strait is a chokepoint between the Horn of Africa and Arab Peninsula, and it is a strategic link between the Mediterranean Sea and the Indian Ocean. Connects the Red Sea with the Gulf of Aden and the Arabian Sea.
  • An estimated 4.8 million bpd of crude oil and refined petroleum products transit through this waterway in 2016 toward Europe, the United States, and Asia, an increase from 3.8 million bpd in 2013. The bulk of Europe’s crude oil imports from the Middle East arrive via this route.
  • The Bab Al Mandeb Strait is 29km wide at its narrowest point, limiting tanker traffic to two 3km-wide channels for inbound and outbound shipments. Closure of the Bab Al Mandeb keep tankers from the Persian Gulf from reaching the Suez Canal or SUMED Pipeline, diverting them around the southern tip of Africa, adding to transit time and cost.