Attacks on ships, costly rerouting and more: What is happening in Red Sea, as spillover of Gaza war by Rishika Singh

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The United States has launched Operation Prosperity Guardian to maintain security in the Red Sea, given the recent attacks. Who is behind the attacks and could it impact the global economy at large?

Houthi military helicopter flies over the Galaxy Leader cargo ship in the Red Sea in this photo released November 20, 2023. (Houthi Military Media/Handout via REUTERS)

Red Sea, one of the most significant shipping routes in the world, is seeing tensions rise as a spillover of the ongoing Israel-Hamas conflict.

US Defence Secretary Lloyd Austin said on Tuesday (December 19) that in the last four weeks, Houthi militants from Yemen have attacked or seized commercial ships 12 times. Prominent shipping fleet operator AP Møller-Maersk and oil and gas giant British Petroleum are some of the companies that have paused their movements through this route in light of the attacks. Prime Minister Narendra Modi also posted on X on Tuesday, saying he spoke with Israeli Prime Minister Benjamin Netanyahu “on the ongoing Israel-Hamas conflict, including shared concerns on the safety of maritime traffic.”

Lloyd also announced the establishment of Operation Prosperity Guardian, a multinational security initiative. Yemen is located close to the narrow Bab el-Mandeb strait, which leads into the Red Sea. Houthi spokesperson Yahya Sarea said that the vessels MSC Clara and Norwegian-owned Swan Atlantic were attacked on Monday.

 Red Sea and Bab el-Mandeb. (Source: US Energy Information Administration)

Why is the Red Sea significant and why are ships being attacked there?

The nearly 2,000-km Red Sea connects the Mediterranean Sea with the Indian Ocean via the narrow Suez Canal. Before the Suez Canal’s construction in 1869, ships had to go around the Cape of Good Hope in South Africa to travel between Europe and Asia. The Suez Canal cut the time and resources it took to cover that distance considerably, by providing a direct route.

According to the US Energy Information Administration, the Suez Canal accounted for 9.2 million barrels per day of total oil flows in the first half of 2023. Marco Forgione, director general at the Institute of Export & International Trade, told Bloomberg that about 12% of global trade depends on the Suez Canal, compared to 5% on the Panama Canal.The Houthis say they have been attacking vessels in the Red Sea with links to Israel. They say this is in protest of Israel’s military offensive in Gaza after the Palestinian militant group Hamas launched an attack against Israel on October 7. Earlier in November, Houthi militants also hijacked an India-bound ship named Galaxy Leader.

How are the Houthis linked to the Israel-Hamas conflict?

The Houthis have been embroiled in a civil war with the Yemen government for almost a decade. They are in power in northern Yemen, including the capital Sanaa. The official government now operates out of Aden.

Named after the Houthi tribe, they are Zaydi Shias. Zayadism is a sub-sect of Shia Islam and it believes in following the lineage of the Prophet Muhammad’s family, as the political leader of the state. However, it also sees launching battles as an acceptable way of usurping power from an unfit or unjust ruler. They have attempted to revive Zayadism amid the growing influence of Sunni Salafist thought, which is inspired by the hadith or the sayings of the Prophet.

According to a report from the Carnegie Endowment for International Peace, “Tribal and regional identities clearly overlap and have been at the core of struggles for political power in Yemen for decades. More recently, sectarian factors have become more pertinent, and religious education has played a growing role in political conflicts.”

Iran, a Shia-majority country, is believed to back the Houthis, even as it has denied the charge. Its regional rival, the Sunni-majority Saudia Arabia (along with Western allies like the US) backs the Yemen government. Houthis’ support for Palestine is, therefore, also a manifestation of existing regional rivalries.

Could the Red Sea attacks impact the global economy?

Oil prices rose on Tuesday, as fears rose about the problems that could confront global shipping and logistics. An Atlantic Council report noted that journeys could increase by two weeks because of the re-routing through Africa.

An analysis from credit rating firm S&P said that freight forwarders, or the middlemen involved in the transportation industry, are also increasing rates on shipments. “A container bound for the Middle East will now attract a war risk surcharge,” it said.

However, Reuters referred to Goldman Sachs analysts, who said the disruption is unlikely to have a large effect on crude and liquefied natural gas (LNG) prices because apart from re-routing, production itself is not being affected.

Reports of countries working to limit the threat also seemed to assuage some market concerns. Under the US-led Operation Prosperity Guardian, joint patrols of the Red Sea will be conducted. An anonymous official in the US told the Associated Press that military ships have increased their presence in the region. While they will not necessarily escort a specific vessel, they will provide umbrella protection to as many as possible.

The United Kingdom, Bahrain, Canada, France, Italy, Netherlands, Norway, Seychelles and Spain have joined the operation, Austin said. Several other countries have also agreed to be involved in the operation but prefer not to be publicly named, according to AP.

Lloyd said in a statement on Tuesday, “This is an international challenge that demands collective action. Therefore, today I am announcing the establishment of Operation Prosperity Guardian, an important new multinational security initiative under the umbrella of the Combined Maritime Forces and the leadership of its Task Force 153, which focuses on security in the Red Sea.”

The Combined Maritime Forces is a multi-naval taskforce that has 39 members – including India, Australia, Bahrain, Brazil, Canada, Egypt, France, Germany, Pakistan, the Philippines, Sri Lanka, the United Kingdom, the United States and Yemen. Operation Prosperity Guardian will be coordinated by the Combined Task Force 153, which was set up in April 2022 to improve maritime security in the Red Sea, Bab el-Mandeb and the Gulf of Aden.

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Disclaimer: Attacks on ships, costly rerouting and more: What is happening in Red Sea, as spillover of Gaza war by Rishika Singh - Views expressed by writers in this section are their own and do not necessarily reflect point-of-view

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