Yemen: The Islamic Chessboard

Houthi take Sana (check), 

Saudi airstrike,

Next move...

Since the start of the year, the Houthis have risen to fame in the drama that is the Middle East. There was little media coverage of the group previously due to their modest beginnings, but also the difficulty of doing serious investigative journalism in Yemen (due to safety and security). However, the increasing threat of the Houthis is now taking centre stage and the international community is paying more attention.

Yemen: The Islamic Chessboard is a series examining the rise of the Houthis and the conflict in Yemen. For now, Yemen appears to be the battle ground in the continuing fight between the Shias and the Sunnis.

The main players:

• The Houthis – a militant group with origins from Zaidism, a religious branch of Shia Islam
• Iran – purported backers of the Houthis, although the latter regularly deny any links to the Iranians
• The Gulf States, led by Saudi Arabia – Sunni states concerned by the growing threat of the Houthis and the apparent spread of Iran’s influence in the region

For the oil markets, the increasing Yemeni unrest poses a threat to the Gulf of Aden, a key shipping route carrying 3.8mmbbl/d – the Gulf is identified by the EIA as one of the world’s choke points in oil supply. A secondary concern, which has not necessarily hit the minds of oil traders yet, is the impact of the uprising on Gulf finances.

Operation Decisive Storm has seen Saudi Arabia send 100 fighter jets in an air campaign against the Houthi, and Kuwait, Bahrain, Qatar and the UAE have committed a further 70 fighter jets in support. Upon the capture of Aden on 25 March, Egypt began the dispatch of a naval fleet, sensing the threat to Suez Canal traffic, one of the Egyptian Government’s most reliable revenue streams.

These military campaigns do not come cheap. For the Gulf States, the cost of this action digs further into monetary reserves at a time when oil prices are at lows and social spending to appease the public post Arab Spring continue to rise. For Egypt, a country already in deficit and trying to rebuild itself following the ousting of Mubarak, this is an unwelcome development.