US launches Red Sea force as ships reroute to avoid attacks

MANAMA — The United States on Tuesday launched a multinational operation to safeguard commerce in the Red Sea as attacks by Iran-backed Yemeni militants forced more major freight companies to reroute, fueling concern over a sustained global economic impact.

The Houthi militant group, which controls vast amounts of territory in Yemen, has since last month fired drones and missiles at international vessels sailing through the Red Sea, in attacks it says are a response to Israel's assault on the Gaza Strip.

This week, the attacks began to take their toll on global trade.

Oil major BP paused all Red Sea transits, and a slew of top shipping firms including Maersk started diverting shipments normally made through the Suez Canal around the Cape of Good Hope. The new route all the way around Africa adds days to journey times and incurs higher costs. The list of companies avoiding the Red Sea continued to grow on Tuesday.

The Houthis say their attacks are a response to Israel's assault on Gaza, the besieged Palestinian enclave on the Mediterranean which is controlled by another Iran-backed militant group, Hamas.

Hamas killed 1,200 Israelis on Oct. 7, drawing a devastating Israeli assault on Gaza that has killed more than 19,000 Palestinians.

Iranian proxy forces, including the Houthis and Lebanese Hezbollah, have fired rockets at Israel. The Houthis have stepped up their Red Sea assault, threatening to target all ships heading to Israel and warning shipping companies against dealing with Israeli ports.

The conflict has increasingly drawn in the United States and its allies on the side of Israel, and Iran and its Arab proxy forces on the side of Hamas, risking a wider regional conflict.

Austin, who is on a trip to Bahrain, home to the US Navy's headquarters in the Middle East, said the United Kingdom, Bahrain, Canada, France, Italy, Netherlands, Norway, Seychelles and Spain were among nations involved in the Red Sea security operation.

The group will conduct joint patrols in the southern Red Sea and the Gulf of Aden.

"This is an international challenge that demands collective action," Austin said in a statement, announcing the initiative as "Operation Prosperity Guardian."

Austin called on other countries to contribute as he condemned "reckless Houthi actions."

But it was unclear how many other countries are willing to do what mostly US warships have done in recent days—shoot down Houthi missiles and drones, and rush to the aid of commercial ships under attack.

A European diplomat whose country will take part in the task force said the idea of the operation was for participating nations' ships to shoot down missiles and drones and accompany vessels through the Red Sea.

The diplomat said it aimed to send a strong signal to Iran and its proxies. "There is no doubt Houthis are acting on behalf of Iran," they said, speaking on condition of anonymity.

Austin on Monday said Iran was behind the Houthi attacks. Iran denies involvement in the attacks, but says it supports its Houthi allies.

Global financial fears

BP's decision to temporarily pause all transit through the Red Sea, and oil tanker group Frontline saying its vessels would avoid passage through the waterway, showed the crisis was broadening to include energy shipments. Crude oil prices rose on those concerns on Monday.

Shipping companies continued to reroute on Tuesday. Denmark's Maersk, which had paused Red Sea shipping, said it would sail its ships around Africa until further notice.

International firms said they were drawing up contingency plans. Sweden's Electrolux said it had set up a task force to find alternative routes or identify priority deliveries if needed.

Many other ships were still plying the waterway. Several ships underway have armed guards on board, LSEG data showed.

Industry sources said the impact on global trade would depend on how long the crisis persists, but insurance premiums and longer routes would be immediate burdens.

Economic policymakers said it was too early to assess the greater financial impact, but the main concern was whether disruption would get serious enough to ignite a new round of global inflation, just as central banks are finally overcoming price pressures after the COVID-19 pandemic.

"Even with the knowledge we have, there is an upward risk in terms of inflation," Bank of Finland Deputy Governor Marja Nykanen told reporters.

Attacks persist

The Houthis said the US-led security initiative would not deter them.

British maritime security firm Ambrey said on Tuesday it received information of a potential boarding attempt 17 miles west of Yemen's Aden port city, adding that the attack was unsuccessful and all crew were safe.

The United Kingdom Maritime Trade Operations said it received a report of an incident 80 nautical miles northeast of Djibouti, at the mouth of the Red Sea.

Many key Arab allies of the United States have so far declined to join. Bahrain's defense minister met Western counterparts to discuss maritime security, an official social media page said on Tuesday, but gave no other details.

The Houthis say they are prepared to confront any coalition formed by the United States, and Iran has warned that the creation of the US-led task force would be a mistake.

About 12% of world shipping traffic usually transits via the Suez Canal, the shortest shipping route between Europe and Asia, passing then as well into the Red Sea waters off Yemen.

Normally, about 11,800 voyages are made each month through the Suez Canal—some 393 a day—according to a Reuters analysis of data from supply chain research firm Project44. — Reuters