So far, the war in Gaza prompted by Hamas’s attack on 7 October has not precipitated the nightmare scenario – a wider Middle East conflict drawing in the US and Iran. But after events of the past few days, that risk appears to be becoming more serious. The centre of the danger is in the Red Sea, where Houthi forces based in Yemen and backed by Iran have been attacking freighters with real or perceived links to Israel. The US has offered protection to shipping travelling through the region, assembling a multinational naval coalition “to uphold the foundational principle of freedom of navigation”. But President Joe Biden has said he wants to avoid direct military confrontation with the Houthis for fear of triggering an escalation. On Sunday, US naval forces crossed that line for the first time, killing all crew on three Houthi boats that had been attacking a container ship. Britain’s defence secretary, Grant Shapps, said the UK “won’t hesitate to take further action” if the Houthi attacks continued. Now, as Tehran rejects calls from Washington and London to end its support for the Houthis, an Iranian destroyer has sailed into the Red Sea. Meanwhile, the UK and US, potentially with another European country, are considering a warning about strikes on military installations in Yemen. Here’s a look at what’s going on, and why there are serious fears about what happens next. How did the crisis begin? Soon after the massacre on 7 October, the Houthi leader Abdulmalik Al-Houthi declared his support for Hamas and said his forces were “ready to move in the hundreds of thousands to join the Palestinian people and confront the enemy”. That may have been an exaggeration: for the next month, Houthi involvement was limited to missile and drone attacks that were largely intercepted by US and Israeli countermeasures. But on 19 November, militants used a helicopter to seize a cargo ship in the Red Sea that was Japanese-operated but ultimately owned by an Israeli businessman. (You can see a video of the hijacking here.) The Houthis abducted the crew and said all vessels linked to Israel would “become a legitimate target for armed forces”. What has happened in the Red Sea since then? There have been at least 17 attacks on vessels the Houthis believe are linked to Israel or its allies, mostly without success. Until now, the US has refrained from direct confrontation. But on Sunday, US Navy helicopters fired on a group of small boats attempting to board a container ship that had requested their protection, the Maersk Hangzhou. While Washington said that its helicopters had fired in self-defence, the deaths of 10 militants mark a new phase in the crisis. The safety of shipping in the Red Sea is important to the world economy because it is an important trade route linking Asia to Europe and the US. Thirty per cent of global container traffic passes through the region, and any significant threat to its safety could have knock-on consequences for oil prices and the availability in the west of items produced in Asia. Israel is also heavily dependent on Red Sea traffic, with the vast majority of imports and exports travelling by sea. Who are the Houthis? The Houthis are a militia group representing a branch of Shia Islam called Zaidism that once ruled Yemen but was marginalised under the Sunni regime in the Yemen capital, Sana’a, since the 1962-70 civil war. They forced the government out in a 2014 coup, prompting a Saudi-led military intervention against them and a catastrophic civil war that the UN estimated led to 377,000 deaths and displaced 4 million people by the end of 2021. The Houthis effectively won the war. An April 2022 ceasefire prompted a significant decline in violence, and fighting has largely remained in abeyance despite the official expiry of the truce in October. Most Yemenis now live in areas under rebel control, with the Houthis now running most of the north of the country and in charge of its Red Sea coastline. Crucially, the Houthis are backed by Iran as part of its longstanding hostility with Saudi Arabia, and the US recently declassified intelligence it said showed Iranian involvement in the operations against commercial shipping in the Red Sea. Many Yemenis see the operations as a legitimate means of exerting pressure on Israel and its allies in defence of Palestinian civilians, and analysts say the Houthis’ intervention has helped shore up their domestic support. The militants also believe attacks in the Red Sea can make them a more significant global player, synonymous with Yemen as a whole despite the presence of an internationally recognised government in the south of the country. Meanwhile, the Saudis are attempting to normalise relations with Iran, and finalise a peace deal that could recognise Houthi control of the north of Yemen – and are anxious about any response from the US that could complicate its effort to withdraw from the country. How are shipping companies responding? Seven of the world’s 10 biggest shipping companies, including BP and the German company Hapag-Lloyd, have suspended use of the Suez Canal and the Red Sea as a result of the crisis. Maersk had recommenced operations in the area a week ago but suspended them again after the attack on the Hangzhou. While others have resumed service after the US organised a naval coalition to protect the area, many container ships are still using alternative routes, with many vessels travelling from Asia to Europe around southern Africa instead – a journey that can take up to two weeks longer. Data released last week by Flexport, a global logistics company, found that half of container ships were avoiding the region, representing about 18% of global container capacity. That is driving up costs – with a surcharge of about $5,000 (£3,927) per 40ft container likely to push rates to triple what they were before the crisis began. Here’s a chart showing the extent of the diversions just after Christmas. What are western governments doing? The White House’s answer to the crisis was to assemble a naval taskforce, called Operation Prosperity Guardian, to defend shipping in the region. While most countries have contributed only sailors, with just the UK and US sending ships, the aim is to make it harder for the Houthis to claim the attacks are focused solely on Israel and the US. Notably, Bahrain is the only Arab country to have joined publicly, with most seeing the economic impact as outweighed by the dangers of being seen as defending Israel. The US has meanwhile been constrained by Saudi Arabia’s concerns about the impact of a big attack on the Houthis on its attempts to finalise a peace deal in Yemen. And there are fears in Washington that any escalation could bolster Iranian influence in the region. But more hawkish observers say the prospect of attacks on shipping without any major response will only make them more frequent. Could the crisis get worse? On Sunday, Julian Borger wrote that “the Middle East has been slipping towards the precipice of a regional war” since 7 October and “the past week has shown how the cliff edge keeping it from that abyss could quickly crumble away”. The US attacks on Houthi vessels are not decisive in themselves: although a significant departure from previous practice, they fall a long way short of strikes on militant bases within Yemen. But if the threat in the Red Sea continues, shipping companies already avoiding the area are likely to continue to do so, with more following their example. Global oil prices have not yet been affected significantly by the crisis, and fell last week because of a belief that the route was reopening. Any sense that the threat is growing again with no effective exit strategy in place could prompt that change. The Houthis have shown no sign of being deterred, saying recently that unless humanitarian aid is allowed into Gaza and Israel stops its attacks, they will not stop harassing shipping “even if America succeeds in mobilising the entire world”. If Sunday’s events do not change that calculus, the US may finally decide to attack targets in Yemen, heightening tensions with Iran, and creating a risk of the wider confrontation that Biden has been so anxious to avoid.