Why Houthi attacks in the Red Sea are so disruptive to trade

Tensions in the Red Sea continue to spiral, and Wednesday, Yemen's Houthi rebels fired a barrage of drones and missiles targeting shipping in the Red Sea, with both the United States and British navies quickly reacting to shoot down the projectiles.

This naval engagement is the latest major escalation in a busy route that is key to global trade. However, despite the conflict, commerce continues --- even as the risk to merchant sailors grows.

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"Trade is continuing to flow through these waters," John Stawpert, a senior manager with the International Chamber of Shipping, told CTV News Channel on Wednesday. "Despite the unacceptable threat that the Houthis present to the lives of our seafarers."

Even so, the United Kingdom Marine Trade Operations (UKMTO) warned vessels transiting through the Red Sea to "transit with caution and report any suspicious activity."

HOW IMPORTANT IS RED SEA ROUTE?

The Red Sea links the Mideast and Asia to Europe via the Suez Canal, and its narrow Bab el-Mandeb Strait, which at the narrowest point is only 29 kilometres --- limits traffic to two channels for inbound and outbound shipments.

Nearly 12 per cent of the world's trade passes through this route, according to Stawpert, and it is a key pipeline for Asia-Europe trade, with products and ships of all kinds passing through the seawater inlet.

"It's oil cargoes. It's bulk cargoes of grain. Materials used in the building industry," Stawpert says. "Any goods you could envisage that can be put in a container."

WILL SHIPMENTS BE CANCELLED?

A U.S.-led coalition has stepped up patrols of the Red Sea to try and prevent attacks on shipping, with Canada and other allies demanding the Houthis cease attacks, warning that they will be held responsible for the escalating aggression.

Last week, Maersk, a massive Danish shipping company, announced it would suspend shipping through the route "until further notice."

However, Stawpert thinks it's "highly unlikely" that there will be a widespread cancellation of shipping, despite that "innocent seafarers" are being targeted by Houthi rebels, who claim the attacks aim to end the Israeli offensive in the Gaza Strip.

"Navies in the Southern Red Sea have given an umbrella of security," Stawpert says. "I think wee will continue to see trade flow through this vital sea route."

SCALE OF ATTACKS NOT SEEN IN 'GENERATIONS'

The significant escalation in attacks is "absolutely unacceptable," says Stawpert, who also warns that the nature of the attacks is also causing growing concern.

"These are missile attacks, these are suicide drones, aggressive approaches by helicopters, by skiffs, and by heavily armed people."

He also warned that despite the boosted presence security presence from the U.S.-led Operation Prosperity Guardian, a multinational effort to protect shipping in the region, attacks are reaching a dangerous new high.

"It's a scale that we haven't seen in two generations, in terms of maritime security."

With files from the Associated Press