The Iran-linked Houthis of Yemen appear to have halted their missile and drone attacks on Israel as the US-backed Gaza ceasefire has gone into effect Friday.

There have not been any recent observable attacks since both sides agreed to accept Trump’s 20-point peace plan, with the Houthis now saying they are ‘monitoring’ the ceasefire and Israel’s compliance, suggesting no more attacks while it is pending. Maritime industry sources in Europe are signaling optimism after a vital global transit route has been effectively blocked for much of the last two years.

Leader of the Houthis, Abdul-Malik al-Houthi, declared Thursday, “We must be at the highest levels of caution and readiness, and continue the massive popular momentum with the Palestinian people, until we determine whether the agreement will be achieved, or whether we will continue our path of support and assistance to the Palestinian people.”

“We will remain vigilant, prepared, and monitor the progress of the agreement. Will it lead to an end to the aggression on the Gaza Strip and the entry of aid, food, medicine, and humanitarian needs to the Palestinian people? Will the Americans and Israelis stop their genocide against the Palestinian people and commit to a ceasefire? This is what we hope for, and it was our goal in the support operations and confronting the attack on the Palestinian people and the nation in general,” al-Houthi added.

While last spring President Trump declared a bilateral US-Houthi ceasefire and withdrew US naval forces from the Red Sea, the Shia group’s war on Israeli shipping and also foreign vessels headed to Israeli ports continued, and even ramped up. But Trump successfully ended America’s direct involvement in the anti-Houthi campaign.

But if the new ceasefire holds – which took official effect Friday – and if the Houthis permanently halt their attacks in turn, this means the Trump deal will have resolved the long-running crisis of global shipping through the Red Sea and the Suez Canal. According to Reuters:

Shares of Danish shipping giant Maersk fell two percent in Copenhagen on Thursday, reflecting investor expectations that safer passage through the Red Sea could eventually restore capacity and reduce freight rates. Analysts cautioned, however, that shipping companies would likely wait months for assurances that attacks would not resume.

Diplomats and analysts said the ceasefire in Gaza could have broader geopolitical implications, potentially easing tensions in the region and fostering conditions for the eventual normalization of maritime security in the Red Sea corridor.

However industry insider and maritime shipping monitor TradeWinds offers a more cautious assessment: 

War risks rates for shipping in the Red Sea have remained steady following the Middle East ceasefire deal as underwriters seek to claw back losses from the deadly Houthi campaign, according to market sources.

Underwriters will wait for evidence that the ceasefire between Israel and Hamas will hold before easing rates for ships travelling through high-risk areas in the Red Sea and Gulf of Aden, said one source.

Insurers are preparing for the return of Greek tanker owners to the region as tensions decline. Longer-term war-risk rates are also likely to fall, with new insurers preparing to join the market.

Since 2023, literally hundreds of missile and drone attacks on commercial vessels have occurred in the Red Sea and the Gulf of Aden. The Houthis have also downed several MQ-9 Reaper drones operated by the Pentagon.

Below: A reminder of the kinds of major attacks and explosions which have been occurring in waters off Yemen over the last two years…

Video allegedly showing the MT Sounion exploding and on fire in the Red Sea. The tanker is carrying 150,000 metric tons of oil. A full release of the cargo would make it one of the worst tanker oil spills in history pic.twitter.com/470pc3OQjj

— Mike Schuler (@MikeSchuler) August 23, 2024

It was the Biden administration which first put together an international naval coalition patrolling regional waters, and led by the United States. But after several waves of airstrikes on Yemen, it did nothing to lessen Houthi resolve.

Could Trump’s big Gaza peace plan have the spillover effect of solving the Houthi and Red Sea shipping crisis as well? Time will soon tell.