U.S. to Cease Military Operations Against Houthis
On May 6, 2025, a U.S.-brokered ceasefire with Yemen’s Houthi rebels, mediated by Oman, marked a major shift in regional dynamics. Under the agreement, the U.S. will suspend airstrikes against the Iranian-backed group, while the Houthis will halt attacks on American vessels in the Red Sea and Bab al-Mandab Strait—one of the world’s most vital maritime chokepoints. The deal follows nearly two months of intense U.S. military action—Operation Rough Rider—which targeted over 1,000 Houthi sites and resulted in hundreds of casualties, including at least 68 civilians in a single strike on a migrant center.
Iran, a key backer of the Houthis, reportedly encouraged the ceasefire to create favorable conditions for renewed nuclear negotiations with Washington. The truce, however, pointedly does not include cessation of Houthi hostilities against Israel, highlighting the conflict’s multilayered nature. While Oman’s successful mediation reinforces its reputation as a neutral broker, the ceasefire’s sustainability remains fragile given ideological tensions and fragmented regional alliances.
From a global perspective, the deal may ease shipping disruptions and reduce oil market volatility. However, the humanitarian toll and ongoing regional rivalries raise questions about the durability of this de-escalation.
Secondary Effects
Impact on Other Sectors: The U.S. military's focus on the Middle East may divert resources from other strategic areas, potentially affecting global military readiness and commitments.
Long-Term Trends: The ceasefire could set a precedent for resolving similar conflicts through diplomacy, influencing future U.S. foreign policy approaches in the region.
Behavioral Shifts: The Houthis' continued aggression toward Israel, despite the ceasefire with the U.S., may lead to increased Israeli military actions in Yemen, potentially reigniting broader regional conflicts.
Forecast
Base Case (60%): The ceasefire largely holds in the short-to-medium term. Red Sea shipping stabilizes, U.S. airstrikes pause, and Iran leverages the calm to re-engage in nuclear diplomacy. However, intermittent flare-ups involving Israel or proxy actors persist.
Upside Case (20%): A broader diplomatic framework emerges involving Iran, Saudi Arabia, and Israel. Houthis de-escalate further under regional pressure, leading to resumed humanitarian aid and infrastructure rebuilding in Yemen.
Downside Case (20%): Houthis resume strikes (especially toward Israel), prompting U.S. re-engagement and regional escalation. Iran withdraws from diplomatic overtures, and maritime routes face renewed threats, reviving global shipping and energy volatility.
