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Local security forces will likely be unable to sustain this level of pressure on the Islamic State without external support or additional resources. 

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Below are our latest and most relevant economics analyses.

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In Yemen, a potential government ground offensive against the Houthis would risk reigniting security threats to Saudi Arabia and the United Arab Emirates, and could undermine the Yemeni government's internal coalition. On April 14, The Wall Street Journal reported that U.S. and Yemeni officials claim discussions are underway about a potential offensive against the key Red Sea port city of Hodeidah as part of a ground offensive against the Houthi militant movement. Other reports in Bloomberg and Abu Dhabi's The National suggested that the attacks might even aim to retake Sanaa, the capital city, and involve tens of thousands of forces. The possible offensive appears to be in a planning phase, rather than a build-up phase, and it remains unclear as to how committed various partners would be in any of these possible scenarios. Indeed, the United Arab Emirates, a key backer of the Yemeni government and of powerful proxies on the ground like the Southern Transitional Council (STC), denied it was participating in such discussions. Despite uncertainty over the veracity of the media reports, they are the first to emerge since the United States launched its naval and aerial campaign against the Houthis in December 2023 (and which the administration of U.S. President Donald Trump has ramped up since March). This suggests that Washington is considering a more direct role in the now-frozen Yemeni civil war in an attempt to break the Houthis' resolve to continue attacking civilian ships in the Red Sea and launching missiles and drones at Israel in solidarity with Hamas in Gaza.

The U.S. military's Operation Prosperity Guardian has involved an extended campaign of air and naval strikes on Houthi leaders, positions and military infrastructure. The campaign is aimed at restoring freedom of navigation in the Red Sea and ending Houthi attacks against Israel, rather than remaking the balance of power in Yemen or restoring the U.N.-backed Yemeni government to power in the north. 
The current phase of Yemen's civil war began in 2014 when the Houthi movement seized control of Sanaa, in the aftermath of political destabilization brought about by the Arab Spring protest movement in 2011. Saudi Arabia and its Arab allies, including the United Arab Emirates, Egypt and Sudan, intervened to roll back Houthi power in 2015. 
Yemen's civil war has largely been frozen since the Houthis and the government agreed to a U.N.-brokered ceasefire in April 2022. This ceasefire only lasted a few months before it lapsed in October 2022, but even so, it did not result in the resumption of widespread offensives and hostilities, nor did it presage the end of Houthi regional attacks against targets in Saudi Arabia and the United Arab Emirates. Since then, the Saudis and Houthis have been engaged in ongoing talks in an attempt to prevent a resumption of war. The conflict was frozen in part due to the aftermath of an unsuccessful Houthi offensive against the key central city of Marib in 2021, the sudden food and fuel price shocks that emerged after the Russian invasion of Ukraine (which disproportionately hurt poor, import-dependent countries like Yemen), and Houthi attacks against Saudi Arabia and, particularly, the United Arab Emirates (which weakened the political appetite from the Gulf Arab states for continued military intervention). Even with the Houthis' intervention in the Gaza war on Hamas' behalf in November 2023 and the beginning of U.S. military operations under Operation Prosperity Garden the following month, the informal ceasefire remained largely in place. The Houthis briefly paused their attacks against Israel and civilian shipping during the Israeli-Hamas ceasefire in Gaza that lasted from January to March 2025, but resumed attacks when that truce collapsed in mid-March.

To keep the frozen conflict in Yemen stable, Saudi Arabia has also deposited cash directly into the Yemeni central bank to help pay salaries for government workers in both the Houthi-controlled north and government-controlled south. These Saudi efforts, however, have inadvertently helped the Houthis consolidate power in the north by stabilizing the economy.
The United Arab Emirates announced it was exiting Yemen in 2019, though it continues to have powerful proxies on the ground in the country. One of those proxies, the Giants Brigade, seized territory from the Houthis in January 2022, sparking a short Houthi strike campaign against Abu Dhabi that killed several civilians.
As intensified U.S. airstrikes fail to halt Houthi attacks on Israel and Red Sea shipping, Washington is increasingly likely to seek on-the-ground Yemeni partners to apply military pressure on the militant movement. U.S. air power will likely fail to thwart all Houthi attacks due to the group's decentralized military infrastructure, as well as its relatively low-tech weapons that rely on smuggling routes from Iran and using dual-use consumer goods. Meanwhile, in Washington, the political appetite for the ongoing airstrike campaign is weakening against the backdrop of growing costs and concerns that munitions used in Yemen may be better deployed to Europe or Asia. As a result, the United States will likely seek Yemeni partners to advance against the Houthis' frontlines on the ground. Such a plan would face major constraints, including hesitancy from key U.S. allies like the United Arab Emirates and Saudi Arabia. But if it did come to fruition, Hodeidah would be a particularly notable target, as it is the only major Red Sea port under Houthi control and would severely hinder the militants' ability to resupply and obtain critical imports of food and fuel for the north and put forces on the road to Sanaa. It would also deliver a blow to morale within the group and impair its ability to recruit fighters and retain the loyalty of the key tribes that comprise its coalition. However, Hodeidah is not the only potential target, with more limited ground offensives potentially taking place around Marib (where the United States is already conducting airstrikes) and Taiz. Should the United States and its on-the-ground partners attack these targets, it would signal Washington's interest in altering the balance of power in the Yemeni civil war without necessarily destabilizing the Houthis' overall position in the north. Indeed, the United States might prefer to more methodically climb the escalation ladder against the Houthis to conserve military resources, given that U.S. airstrikes are depleting stocks and the Houthis have shot down numerous surveillance drones. 

Dislodging the Houthis from Hodeidah, even if possible, would not necessarily weaken their ability to continue carrying out attacks on Red Sea shipping. Being forced farther into Yemen's interior could thwart some of the Houthis' shorter-range systems from being able to target ships passing regional sea lanes. However, the Houthis' vast arsenal and smuggling networks mean they would still likely be able to conduct some attacks, even if not at the same frequency, which would still be enough to deter most shipping companies from reentering the area. 
U.S. intelligence has not been able to identify all the smuggling routes by which the Houthis resupply their arsenal. Some of the Houthis' weapons, like their Sammad 3-style UAV drones, can be produced locally, and others, like their Zulfiqar medium-range ballistic missiles, are more likely to be imported in components from Iran. Yemen's long, porous borders, both by land and sea, make smuggling efficient, even with a large U.S. naval presence in the Red Sea and Arabian Sea trying to intercept such operations. 
An unconfirmed but assumed to be small number of U.S. special forces have long been deployed covertly in Yemen as part of counterterrorism efforts. However, putting more boots on the ground remains highly controversial in the United States, where the Trump administration is trying to retrench from the Middle East. 
New ground offensives would risk prompting the Houthis to redirect some of their long-range systems from Israel to Saudi Arabia and the United Arab Emirates, targeting major cities like Riyadh and Abu Dhabi, and/or Gulf Arab energy infrastructure along the Persian Gulf. The Houthis have the capabilities to strike deep inside the Gulf Cooperation Council. In the past, these strikes have often been intercepted by U.S.-made air defenses, but have nevertheless rattled the political resolve of Gulf Arab governments and created uncertainty for businesses and investors looking to engage with these countries' economic diversification programs. Particularly if Gulf Arab-backed proxies, like the UAE-backed Giants Brigade, participate in ground offensives in Yemen, the Houthis would likely target their host countries in an attempt to undermine those governments' political resolve for backing such an offensive. While these attacks may not cause significant physical damage, they will still pose risks for civilians and undermine business and investor confidence in regional security conditions. 

Saudi Arabia is trying to convince businesses to move their regional headquarters to Riyadh, which, before the 2022 Yemen ceasefire, would see occasional ballistic missile attacks by the Houthis. 
Both Saudi Arabia and the United Arab Emirates are also seeking to attract more tourism, an industry that is particularly sensitive to security incidents like missile and drone strikes. 
In prior phases of Yemen's civil war, the Houthis have struck major cities like Riyadh and Abu Dhabi, energy sites (like Saudi Aramco facilities) and airports. 
As a result of such risks, parts of the Yemeni coalition may be unwilling to participate in a U.S.-coordinated ground offensive against the Houthis, straining the Yemeni government's coalition and deepening its existing internal splits. Saudi Arabia, in particular, has recently shifted its approach to Yemen toward de-escalation and diplomacy rather than military pressure after years of unsuccessful campaigns to oust the Houthis from the north. Saudi-backed elements in the Yemeni coalition may be less willing to carry out ground offensives for fear of provoking direct strikes on Saudi Arabia again and undermining confidence in the kingdom's Vision 2030 economic diversification program. Riyadh will also be concerned that backing a U.S.-organized campaign against the Houthis might undermine its ongoing outreach to Iran, most recently evidenced by Saudi Defense Minister Khalid bin Salman's visit to the country on April 17. Without Saudi support, it is thus unclear if a U.S.-backed ground offensive would even be strong enough to take key cities like Hodeidah. And if such an offensive stalls out or results in military debacles, it would produce significant domestic political fallout among the Yemeni government's internal factions that would weaken its integrity as leaders trade blame for the offensive's failure. Conversely, if the offensive is successful without the full backing of the Yemeni government's coalition, it would deepen internal splits as the participating factions consolidate power and seize territory to raise money and recruit new fighters. Any ground offensive conducted against the Houthis without the full unity of the Yemeni coalition would likely also exacerbate tensions between Yemen's central government and its rivals, like the Southern Transitional Council (STC), as well as Saudi- and Emirati-backed factions, which would ultimately risk further balkanizing the war-torn country.

The last government offensive to recapture Hodeidah failed in 2018 due to international concerns that fighting in the port city would cause a humanitarian crisis in Yemen's north. The failed offensive contributed to the United Arab Emirates' decision to retrench from Yemen a year later. 
Saudi-backed factions and Emirati-backed ones have long-standing divisions over the future of Yemen and power sharing, with occasional clashes breaking out between them. The UAE-backed STC continues to want an independent South Yemen, something opposed by the Saudis. 

test again for article sync iIn Yemen, the U.S.'s Anti-Houthi Campaign Raises the Specter of a Government Ground Offensive

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RANE's Europe Analyst Matteo Ilardo and RANE's Director of Analysis Adriano Bosoni break down the economic and security ramifications of the shifting U.S.-Russia relationship for European countries and companies with interests in the region.

RANE is a global risk intelligence company that delivers risk and security professionals access to critical insights, analysis and support to ensure business continuity and resilience for our clients. For more information about RANE's risk management solutions, visit www.ranenetwork.com.RANE's Europe Analyst Matteo Ilardo and RANE's Director of Analysis Adriano Bosoni break down the economic and security ramifications of the shifting U.S.-Russia relationship for European countries and companies with interests in the region.

RANE is a global risk intelligence company that delivers risk and security professionals access to critical insights, analysis and support to ensure business continuity and resilience for our clients. For more information about RANE's risk management solutions, visit www.ranenetwork.com.

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India and Pakistan's series of tit-for-tat diplomatic and economic moves following a deadly militant attack will heighten the risk of kinetic responses, such as airstrikes or special forces operations, while also fueling domestic unrest due to rising nationalist sentiment in both countries. On April 23-24, India and Pakistan announced a series of sweeping tit-for-tat measures to scale back bilateral ties following a deadly militant attack in Indian-administered Kashmir that killed 26 civilians and injured 17 others.

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Intensifying trade wars, a potential ceasefire in Ukraine, continued volatility in the Middle East and consequential elections in key countries will shape the quarter.

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Australia will hold a federal general election on May 3 after Prime Minister Anthony Albanese of the incumbent Australian Labor Party, or ALP, called new elections on March 28, hoping to take advantage of the federal budget's release to secure a bump in popularity ahead of the polls. The election will determine whether the ALP, led by Albanese, secures a second three-year House term, or whether the Liberal-National coalition, or LNC, returns to power after one term in opposition. Half the Senate will also be up for election, with the outcome critical to the next government's ability to pass legislation.

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These are not emerging risks – they're here right now. In recent years, the world has seen repeated examples of the impact of a warming planet, such as more frequent and extreme weather events, droughts and increasing water scarcity, rising sea levels, and the spread of tropical infectious diseases into cooler climates, just to name a few. These climate-related risks have had clear and quantifiable impacts on organizations worldwide, ranging from supply chain disruptions, higher insurance costs, the adoption of enhanced worker safety measures and increasingly complicated compliance requirements.

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A preview of the upcoming week and a selection of recommended RANE articles from the past week.

Stag: The Weekly Rundown: Mexico Ratifies a Controversial Judicial Reform, the U.N. Votes on a Palestinian Resolution

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Economics+afghan: Burundi Warns of Regional War as South African Forces Languish, Uganda Deploys Troops

Government Frees U.S. Prisoners, Agrees To Receive Deportees

Sitrep: India: Government Presents Union Budget Aimed at Economic Growth

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Sitrep: Somalia: Puntland Orchestrates Crackdown on Islamic State

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