US and UK threaten to up the ante in the Red Sea: The US and the UK are looking to step up their fight against the Houthis in Yemen following fresh Houthi attacks on vessels sailing through the Red Sea, Bloomberg reports. The two countries — who began carrying out strikes on Houthi facilities across Yemen in the middle of January — are looking to attack Iranian resupplies and amp up their attacks against Houthi militants without having the conflict escalate into a broader war. Biden has pledged that US airstrikes on Yemen will continue, despite telling reporters that they have done little to curb the Houthis’ attacks in the Red Sea.

The Houthis show no sign of slowing down: Houthi fighters launched two anti-ship ballisticmissiles at a US-owned commercial vessel on Thursday, marking the third such attack in a three-day period, US Centcom said in a statement. The Houthi’s leader said in a televised speech on Friday that his group is “confronting America directly,” and vowed that it would continue to attack vessels in the Red Sea until Israel’s blockade on Gaza is lifted.

The ramifications are being felt at home: Egypt has lost about USD 150 mn in Suez Canalrevenue due to ongoing Red Sea disruptions, Bloomberg’s chief emerging markets economist Ziad Daoud said on X. Daoud added that the amount is small in relation to our annual GDP of USD 400 bn+, but cautioned that the costs of disruption will continue to pile up and come amid a currency crisis in the country. Trade volumes through the canal fell almost 44% y-o-y during the week ending 19 January to a seven-day moving average of 2.8 mn tons, according to data from the IMF’s PortWatch.

More and more shipments are avoiding the canal following the US-led strikes on Yemen: Oil shipments from Saudi Arabia and Iraqtotalling around 9 mn barrels are rerouting away from the Red Sea and Suez Canal and are instead sailing around Africa’s Cape of Good Hope, according to Bloomberg ship tracking data. Most of the shipments were diverted following the US and UK’s airstrikes on Yemen on 12 January.

CMA CGM’s NEMO service joins the exodus: France’s CMA CGM, the world’s third-largest container shipping group, said on Friday that its NEMO service connecting Europe with the Indian Ocean and Australia will temporarily stop crossing through the Suez Canal and will reroute around the Cape of Good Hope instead.

Red Sea disruptions threaten global food security: Vessels carrying shipments of food andagricultural produce are among those avoiding the Red Sea by rerouting around the Cape of Good Hope, according to Bloomberg. However, unlike shipments of oil, gas, or consumer goods, food shipments — especially shipments of agricultural produce — are at risk of spoiling as a result of lengthier shipping times.

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