Among the broader regional effects of the October cease-fire in Gaza, one of the more significant was supposed to be a new calm in the Red Sea and potentially in Yemen. Indeed, as a result of the truce, the Houthis—the heavily armed militant group that controls northern Yemen, including the capital, Sanaa, and is allied with Hamas and Iran—paused their attacks on commercial shipping in the Red Sea and against Israel. An earlier Omani-brokered agreement between the Houthis and the U.S. government also seemed to wind down the direct Houthi threat to U.S. assets in the shipping corridor. Within Yemen, a fragile three-and-a-half-year-old truce in the civil war between the Houthis and the internationally recognized government was still in place. Although the Houthis were not defeated, U.S. officials seemed to believe that the situation in the country had quieted and that they could turn their attention elsewhere.

Less than two months later, that relative calm is fading. In early December, southern Yemeni separatists launched a major campaign to seize large parts of the Hadramawt, an oil-producing region bordering Saudi Arabia, and Mahra, a province bordering Oman. The offensive by the Southern Transitional Council, a group that is part of the internationally recognized Yemeni government but advocates independence for southern Yemen, marks a seismic shift in the country’s balance of power. For one thing, the STC is backed by the United Arab Emirates, and its bold expansion has set off new tensions with Saudi Arabia, which supports competing factions within the government and views the takeover as a potential threat to its national security. Still more concerning, the STC offensive is likely to provide a pretext for larger actions by the Houthis.

Even as the STC campaign has unfolded, the Houthis have vowed to extend their own control over the oil- and gas-producing regions in the country’s east. With the help of Iran and other countries, the Houthis have also worked tirelessly to expand their arsenal of advanced conventional weapons; they have also scaled up domestic weapons production, with the capacity to assemble ballistic missiles as well as to independently manufacture short-range drones. Moreover, the group’s actions and rhetoric continue to underscore its desire to control all of Yemen and to continue to confront Israel, the United States, Saudi Arabia, and the UAE. If the Gaza cease-fire falters, the Houthis are ready to continue their Red Sea attacks, and now that they have seen how effective that campaign has been, they could restart it for other reasons in the future.

The United States ignores Yemen at its peril. Thus far, the Trump administration has limited itself to imposing sanctions on the Houthis, protecting the U.S. bilateral truce with the group, and hoping that Israel and U.S. partners in the Gulf will sort out any other issues on their own. The administration has also largely stepped away from supporting the government of Yemen and providing diplomatic leadership to end the civil war. 

But without a broader U.S. strategy, financial pressure on the Houthis may well backfire. Before the STC’s move in December, the Houthi leadership suggested it might seek to seize more territory or extort financial concessions from Saudi Arabia to gain more resources. Now the upheaval in the south has made the country more combustible, threatening to reignite a conflict that has until now played to the Houthis’ advantage. Any return to full-blown war would have reverberations across the Gulf and the Red Sea region.

As the dust settles from Israel’s war in Gaza, the Houthis are notable outliers. With Hamas decimated, Lebanon’s Hezbollah largely decapitated, the regime of Bashar al-Assad in Syria toppled, and Shiite militias in Iraq avoiding conflict with Israel, the other members of Iran’s once powerful axis of resistance are severely weakened. By contrast, the Houthis have been emboldened by the war in Gaza, which helped enable their leaders to harden the group’s ideological core, marginalize pragmatists, and reinforce their supporters’ belief that they are on a holy mission to liberate Palestine and upend a U.S.- and Israeli-dominated regional order.

The Houthis have derived tangible rewards from their defiance. By staying on a war footing, they have avoided accountability for rising poverty and for failing to pay public sector salaries in areas they control. They have also used the conflict to crack down on perceived enemies, narrow any........

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