The US and UK launched around 70 airstrikes on Houthi targets in
Yemen to counter shipping attacks in the Red Sea. The Iran-backed
Houthi group has pledged to retaliate, expanding their campaign
against commercial vessels, with US and UK interests now considered
legitimate targets. This military action has led to a rise in oil
prices by more than 4%, reaching above $80 a barrel. The conflict,
stemming from the Israel-Hamas war, has disrupted global supply
chains, raising freight costs.
Despite the escalating situation, the impact on the global economy
is expected to be limited, according to Ziad Daoud, chief emerging
markets economist at Bloomberg Economics. The strikes targeted
airports, radar installations, and storage sites, aiming to degrade
the Houthis' ability to attack shipping. The international
community, including the Netherlands, Australia, Canada, and
Bahrain, supported the mission.
Companies have rerouted ships away from the Red Sea, affecting
supply chains. Volvo Car AB suspended production in Belgium due to
disruptions, and Tesla Inc. noted the impact on its European
factory. The conflict may not end here, and the US and UK are
likely to press regional allies to help restrain the Houthis. Saudi
Arabia expressed concern about the strikes, indicating unease among
some of the US's regional allies.
Source: Reuters | US and Britain strike Yemen in reprisal for Houthi attacks on shipping
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