The Iran war’s second month has opened with a sharp escalation in threats to global shipping, as Iranian-backed Houthi rebels fired their first missiles since the conflict began, drone strikes hit the port of Salalah in Oman, and a bizarre last-minute reversal by COSCO added fresh uncertainty to an already unpredictable operating environment.

The Houthis’ entry into the active conflict on Saturday marks a significant threshold. The group, which attacked more than 100 merchant vessels between November 2023 and October last year, had until now limited itself to words of condemnation. Saturday’s missile launches toward Israel, accompanied by warnings that vessels seen as supporting the war would be targeted, signal that the Bab el-Mandeb Strait – through which around 12% of global trade typically passes – is now back in play as a potential conflict zone. Since the Strait of Hormuz effectively closed, Saudi Arabia has been routing millions of barrels of crude daily through Bab el-Mandeb. 

“Our fingers are on the trigger,” Houthi military spokesman Brigadier General Yahya Saree warned on Friday, before the missiles were launched.

“[I]t is time for supply chain stakeholders to prepare for a situation where both Hormuz and the Red Sea continue to be chokepoints for a considerable amount of time,” warned Lars Jensen, a container shipping expert, via LinkedIn today. Jensen has been providing a daily update of both the Red Sea and Hormuz crises since they started. 

The port of Salalah in Oman was struck by drone attacks on Saturday, with a container crane damaged and a port worker injured. 

With Hormuz effectively closed, Oman’s Salalah and the Red Sea coast of Saudi Arabia represent the only viable land bridge routes for container cargo moving to and from the Persian Gulf region. 

Two of Chinese state-backed COSCO vessels of 19,000 teu were clearly heading for an exit from the Gulf last week, only to execute an abrupt U-turn as they approached Larak Island, where Iran’s new transit corridor begins.

There has been some limited positive news on the navigation front. AIS jamming that had severely disrupted vessel tracking throughout the Gulf has eased somewhat over the weekend, giving shipowners a clearer picture of where their vessels actually are. A cluster of hundreds of vessels that formed a near-perfect circle near Abu Dhabi on March 2 had shrunk to fewer than ten by Monday. Iranian drone and missile attacks have declined approximately 80% from their March 1 peak, and Tehran appears not to have launched attacks on vessels since March 20.