Shifting Sands in the Gulf: Yemen, Saudi Strategy, and the New Middle East Power Balance

Over the past few years, the Middle East has witnessed profound shifts in its economic, political, and security dynamics. The gradual weakening of American influence, coupled with China’s expanding diplomatic and economic footprint, has altered long-standing power equations across the Gulf. Most notably, the restoration of diplomatic ties between Saudi Arabia and Iran—and Saudi Arabia’s evolving defence cooperation with Pakistan—have reshaped the region’s geopolitical landscape, triggering new alignments and recalibrations from Yemen to the Red Sea.

These changes came sharply into focus on Tuesday when the Saudi Air Force targeted two vessels carrying military equipment en route from the Emirati port of Fujairah to Mukalla in southern Yemen. According to coalition spokesperson Major General Turki al-Maliki, the shipments were intended to reinforce the UAE-backed Southern Transitional Council (STC) in Hadramawt and al-Mahra, a move Riyadh viewed as inflaming Yemen’s internal conflict rather than stabilising it.

Within 24 hours of the airstrikes, and on the instructions of Yemen’s Presidential Leadership Council (PLC) chairman Rashad al-Alimi, the United Arab Emirates agreed to withdraw its forces from Yemen, averting a potential confrontation with Saudi Arabia. Yet the episode exposed deeper contradictions—spanning oil markets, regional security, and geopolitical ambitions—stemming from the advance of the STC’s separatist agenda in southern Yemen.

The latest bout of tension also reflects broader regional undercurrents. In November, misreporting surrounding talks in Washington between Saudi Crown Prince Mohammed bin Salman and US President Donald Trump on the Sudan crisis contributed to diplomatic unease. At the same time, Saudi Arabia’s ambitious social, political, and economic reforms—particularly the construction of the futuristic NEOM city on the Gulf of Aqaba—have been perceived by smaller Gulf states as a challenge to their economic and strategic interests.

This perception was underscored by claims from a Houthi commander that Emirati intermediaries had encouraged attacks on NEOM. Within this context, the UAE-backed STC’s renewed push to re-establish an independent southern Yemeni state has disrupted peace talks between the Houthis and the PLC, effectively dragging Saudi Arabia back toward a conflict it had been seeking to exit.

Yemen has remained embroiled in civil war since 2015, pitting the Iran-aligned Houthi movement against the internationally recognised government and a constellation of rival armed groups. Although the STC is formally opposed to the Houthis and nominally part of the PLC, it has simultaneously pursued its long-standing objective of southern secession. As a result, Yemen today remains fragmented, with power divided primarily among the PLC, the STC, and the Houthis.

The STC itself was formed on 11 May 2017 following mass protests in Aden against the dismissal of its leader, Aidarus al-Zubaidi, who later joined the PLC. Its declared aim is the restoration of an independent South Yemen, which existed between 1967 and 1990. With Emirati backing, the STC consolidated control over Aden and expanded its influence across much of the south, even while agreeing—at least formally—to power-sharing arrangements with the recognised government.

Recent STC attacks on parts of oil-rich Hadramawt, including areas around the presidential palace in Seiyun, have further destabilised the situation and threatened to give the Yemen conflict a new and dangerous direction. The PLC, established in 2022 after former president Abdrabbuh Mansur Hadi transferred his powers to an eight-member council, was intended to manage Yemen’s political and security transition and advance negotiations toward a permanent ceasefire. However, deep internal rivalries since 2022 have significantly weakened the council’s effectiveness.

The Houthi movement—formally known as Ansar Allah—continues to control Sana’a and much of northern and north-western Yemen, including areas along the Saudi border. Strengthened by the turmoil following the Arab Spring and later by regional rivalries, the Houthis fought a Saudi-led coalition for years before the conflict largely froze after the Saudi-Iran rapprochement in 2022.

In November 2023, the Houthis began targeting military and civilian vessels they claimed were supplying Israel, framing their actions as pressure to halt what they described as atrocities in Gaza. Subsequent US airstrikes on Houthi targets reinvigorated lobbying by anti-Houthi factions—particularly the STC—for American backing in a renewed push to divide Yemen. Despite reports that Washington and Abu Dhabi discussed options, including operations around the port of Hodeidah, there has been little meaningful movement on the ground.

Crucially, Saudi Arabia has shown little appetite to re-enter a full-scale war against the Houthis. After years of costly conflict, Riyadh and the Houthis agreed to a truce in 2022, leaving the future of the Yemeni government and other anti-Houthi groups uncertain. In the current global context, Western powers—including the US and Israel—may find it increasingly difficult to identify reliable regional proxies in Yemen.

Following its defence agreement with Pakistan, Saudi Arabia’s enhanced military posture has further deterred regional actors from joining any adventurism against Riyadh—whether in Yemen or along the Gulf of Aden. The result is a Middle East in flux: one where old certainties are fading, new power centres are emerging, and unresolved conflicts like Yemen remain deeply entangled in the shifting balance of regional and global interests.