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Amid a Houthi Escalation, Iran’s Gray Zones Begin to Shrink

The Gaza war has proved a direct challenge to Tehran's yearslong strategy of ambiguity about how it will respond

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Amid a Houthi Escalation, Iran’s Gray Zones Begin to Shrink
Yemen’s Houthi loyalists take part in an armed parade for more than 20,000 members who have finished a military course on Dec. 20, 2023. (Mohammed Hamoud/Getty Images)

The war in Gaza has opened an unthinkable new chapter in the Middle East, whose full consequences, including the disruption of Red Sea trade and possible war in Lebanon, are only starting to emerge.

More than three months after Hamas’ Oct. 7 attack on Israeli towns around Gaza, close to 25,000 people have been killed while hundreds of thousands have been injured or displaced. Now, the fight is no longer limited to Gaza. In addition to escalating attacks between Israel and Hezbollah in Lebanon, the war has most recently led the Houthi militant group in Yemen to become involved, targeting commercial ships in the Red Sea, while, in turn, provoking retaliatory missile strikes from U.S. and U.K. naval forces.

From the perspective of Iran, which plays a central role as the major patron of all the militant groups now waging war with Israel and its backers, the current conflict might have started in earnest on Oct. 7, 2023, when a high-ranking officer overseeing Palestinian affairs within the Quds Force of Iran’s Revolutionary Guard Corps (IRGC) received a flurry of alerts on his phone, according to inside sources. Initially dismissing these alerts as a glitch in the Israeli missile warning app, Tzofar, the officer was jolted to reality by a call from a colleague in Baghdad. The caller, inundated with queries about the unfolding events in Gaza, forced the IRGC officer to reconsider the numerous notifications he had earlier ignored, urgently drawing his attention to the escalating situation as evidenced by the stream of images and videos from the settlements near Gaza.

The unexpected scale of the Hamas attack left everyone, including Israel, Iran, Hezbollah, Qatar, Turkey, the United States, along with much of the world, astonished. Even Hamas’ political leadership was surprised by the rapid developments, according to a Hamas insider. Hamas’ leader in Gaza, Yahya al-Sinwar, and the head of its military arm, Mohammed al-Deif, had initiated an open war with Israel. This stunning decision left both allies and adversaries in a state of disarray, focusing on immediate reactions rather than long-term strategies.

But while Tehran was initially taken aback by the outbreak of this conflict, it has swiftly adjusted to the evolving dynamics in the region. For the first time since the creation of what it initially called the Axis of Resistance in the late 1990s and early 2000s, now officially termed the “Jerusalem Axis,” Iran observes from a relatively safe distance the various operations and roles played by the groups under its influence. This new phase, unfolding without Iran’s late military commander Qassem Soleimani and under non-Iranian leadership, notably in Gaza, Yemen and Lebanon, represents a new chapter for Tehran’s decision-makers.

It also brings a mix of temptation and confusion, particularly against the backdrop of Iranian officials’ fiery rhetoric promising imminent victory in Jerusalem. Iran has succeeded in creating an ambitious, powerful and resilient network of militias that span the entire region. But the same axis that it has created now threatens to drag the entire region into a war premised on unattainable maximalist goals of conquering Jerusalem and redrawing the political borders that have existed since the era of Sykes-Picot. It is this mismatch of means and ends that may prove to be Iran’s catastrophic success, generating grave challenges for Iran even as it emerges as hegemon of a region it has long sought to dominate.

According to media reports from the region, a high-alert communication line between Tehran, Baghdad, Damascus, Beirut and Sanaa has become notably active since the initial Oct. 7 attacks. A command center in Beirut coordinates the regional strategies of the Iranian-led axis, according to London-based Amwaj Media, capitalizing on the geographical advantage these allies have. Baghdad-based militants have intensified actions against American troops, Lebanon’s Hezbollah engaged Israelis, Sanaa conducted complex maritime operations, and Syria sporadically launched missiles and drones, becoming another — albeit very weak — front for regional war-by-proxy between Israel and Iran.

The recent killing in December of top IRGC officer Sayyed Razi Mousavi in an alleged Israeli airstrike while he was on official business in Damascus highlights the escalating tension in the region as Israel and its backers strike back, as does Israel’s targeting of Hamas’ senior leader Saleh al-Arouri in the southern Beirut suburb of Dahiyeh, known as a Hezbollah stronghold. While Israel’s likely involvement in the killing of Mousavi did not elicit a direct response from Iran, the Beirut assassination prompted Hezbollah to retaliate by attacking a strategic Israeli air traffic base in Mount Meron, resulting in significant damage, according to Israeli news reports.

It is widely acknowledged that Tehran has significantly influenced the growth and capabilities of militant organizations in Palestine, including Hamas and Palestinian Islamic Jihad, as well as Hezbollah in Lebanon. Amid escalating violence and widespread casualties, Palestinian groups today seek dependable support and promises. They view these as owed obligations, feeling a sense of injustice and disappointment when such commitments are unmet.

Despite their skirmishes with Israel and Western powers, Hezbollah, the Houthis and Iraqi militias groups have so far not initiated a full-blown war to come to the aid of Palestinians. As a friend from Gaza put it in a recent chat, “There are those in Gaza who feel that the Axis did to Gaza what the people of Kufa did to Hussein in Karbala.” The reference pertains to the historically iconic moment of failure to save the grandson of Prophet Muhammad from the Umayyads in the seventh century, an anecdote that is pivotal in Islamic history and of particular significance to Shiite Muslims.

Tehran has previously promised to consolidate conflict zones to present a unified front against Israel. Decision makers within this network have attributed the failure to do so to unforeseen circumstances where they find themselves retaliating against Israeli and American strikes, while striving to keep their responses below the threshold of triggering full-scale escalation.

Still, responses by members of the axis to the war in Gaza have been significant and risky, particularly the targeting of U.S. bases in Iraq and Syria by Kataib Hezbollah and other Iraqi groups. Lebanese Hezbollah has also activated a conflict zone — Lebanon — that had been relatively calm for the last 17 years. Yet the most significant and unanticipated escalation has been in Yemen, where the Houthis have effectively led a naval blockade in the Red Sea, impacting commercial sea routes to Israel and the wider Mediterranean.

The strategy employed by the Houthis, or Ansar Allah as they are formally known, capitalizing on their control over the Bab al-Mandab Strait, echoes a maneuver by former Egyptian President Anwar Sadat in the 1973 war with Israel that threatened to bring the global economy to a halt. Bad memories of that period help partly explain why the U.S. and the U.K. have been so swift to become involved today. During that conflict, Sadat effectively halted the primary southern oil supply route by blockading the Red Sea’s entrance at Bab al-Mandab and shutting down the Suez Canal. That strategy was originally conceived by the late President Gamal Abdel Nasser, who fought a five-year war in Yemen. His goal was to establish control over Yemen, thereby ensuring Egypt’s dominance over the Red Sea, stretching from the Suez Canal to the Bab al-Mandab Strait.

The Houthis’ calculations behind the Red Sea blockade are not clear, nor is it clear whether their actions were carried out with guidance from Iran. But the blockade was not the first act of the Yemeni group’s involvement in the Gaza war. The Houthis launched ballistic missiles and drones toward Israel on Oct. 19, shortly after Israel’s assault on Gaza began, with Israel’s retaliation marking the first known instance of armed conflict between states in space.

Astonishingly, the Houthis’ foray into the Palestinian-Israeli conflict has helped them carve out a different public image for themselves in many parts of the region, where they had previously been viewed as mere Iranian proxies. They are now instead widely celebrated as champions of the Palestinian cause, with positive media coverage for their attacks in major television stations and on social media. The Houthis’ popularity has surged among Palestinians, especially as the substantial impact of disrupting Red Sea trade has become clear. Major corporations have declared a halt to all transit in the area, affecting not just the region but the entire global supply chain through the resultant impacts on maritime shipping costs. From the perspective of many Palestinians, the Houthis’ actions, however disruptive, have imposed costs on an international community otherwise willing to quietly accept the annihilation of Gaza.

The irony is, after being the bete noire of the southern Arabian Peninsula, the Houthis now stand to strengthen their political hold in Yemen following the U.S.-U.K. airstrikes on various Yemeni cities, making it more challenging for their regional and local adversaries, including Saudi Arabia, to contest their legitimacy. This legitimacy has become deeply intertwined with the Palestinian cause, symbolically cemented through a shared struggle. Houthi military spokesperson Yahya Saree has become a household name in the region as a result of his public appearances discussing the conflict, highlighting the group’s concern for gaining recognition for their actions.

Senior Houthi official Mohammed Ali Houthi wrote on X (formerly Twitter) explaining his group’s position. He stressed that the actions claimed by the group aren’t for domestic popularity, but to help lift the blockade on Gaza. He added that “we feel Palestine’s pain, having suffered similar pains caused by the American-British-Saudi-Emirati coalition and its allies. The Yemeni armed forces demand the cessation of the American-Israeli aggression on Gaza and the provision of food and medicine to Gaza’s people.”

That was the Houthis’ thinking before the U.S.-U.K. strike, but now things have changed, and new objectives have emerged for them and other groups who count themselves part of the Resistance Axis.

In Iraq, a source from Kataib Hezbollah told New Lines that their objectives in escalating against the U.S. extend beyond mere disturbances; they’re aiming to open an entirely new front by launching drones and missiles toward Israel. This strategy is designed to compel U.S. decision-makers to recognize that the situation is rapidly escalating beyond their control. The source in Baghdad disclosed that this heightened threat has necessitated a change in the U.S. approach to handling these risks, pointing to operational strains for the U.S. in terms of responding to these attacks.

The same source stated that Kataib Hezbollah and other Iraqi factions have forces positioned near the Israeli border. These forces are prepared to act on orders from the central operations command when necessary. Furthermore, the source indicated that if the Houthi movement in Yemen faces attacks, the Iraqi groups will escalate its response. This could include targeting U.S. bases in the Gulf, potentially leading to a critical situation at two major maritime waterways, the Bab al-Mandab and Hormuz.

The source from Kataib Hezbollah also shared daily maps displaying the presence of numerous U.S. aircraft over Iraq, with more than 20 planes regularly patrolling the skies above Baghdad alone, including both armed and reconnaissance aircraft. The source stated their belief that recent attacks have made the U.S. more open to withdrawing from Iraq entirely. The Iraqi prime minister Muhammad Shiaa al-Sudani has recently proposed starting negotiations for a U.S. departure, suggesting that the withdrawal should begin concurrently with negotiations, rather than waiting until their conclusion, marking a more aggressive shift from previous approaches. An advisor to al-Sudani reported that the prime minister’s Dec. 20 meeting with Victoria Nuland, acting U.S. deputy secretary of state, was tense, focusing on discussions about ending the U.S. military presence in Iraq.

Iran is watching these developments closely and weighing its next moves. A source in Iran’s Quds Force speaking to New Lines compared the current regional situation to a complex chess game involving multiple players. The source said, “There’s been a significant upheaval reshaping West Asia’s landscape, with each faction vying to redraw the regional map according to various agendas. Timing is crucial in these conflicts, and every move has far-reaching effects, leaving no room for emotional decisions or mistakes.” Another Iranian source added that Iran’s direct involvement in conflicts is firmly opposed by key members of their alliance. “Even if Iran were inclined to engage militarily, the resistance factions would oppose it. Iran is the backbone of the alliance, providing military, financial, political and diplomatic support. Direct Iranian intervention is only contemplated if the entire alliance faces a critical threat, particularly if America becomes actively involved.”

The status of Lebanese Hezbollah, the most powerful partner in the Iranian-backed alliance, is of particular interest. Hezbollah has had no significant military engagement with Israel since 2006, when it successfully fought an Israeli military invasion of southern Lebanon to a standstill. The long absence of major combat against Israel has led to a renewed internal focus on assessing their combat capabilities and understanding Israel’s new strategies.

When the recent crisis erupted, Hezbollah demonstrated its capability to deter Israel from attacking Lebanon by hitting targets well inside Israeli territory. While it has refrained from full-blown escalation to support Hamas in Gaza, Hezbollah has effectively drained its adversary by compelling Israel to keep a significant portion of its military forces in the north and to incur substantial costs for deploying Iron Dome missiles and the Patriot defense system. These defenses were used against relatively basic weaponry, like Katyushas fired from Lebanon or unsophisticated air defense missiles. This strategy in particular seemed to frustrate the Israelis, as Hezbollah has not yet deployed its more advanced and modern weaponry. The exception has been the regular and advanced versions of the Kornet missile, now employed to target military sites up to 5 miles deep inside Israel.

The Kornet missiles have proved their effectiveness, especially in destroying buildings occupied by Israeli soldiers. Yet, the casualty figures show a disparity: While the number of Israeli fatalities on the Lebanese front remains relatively low, Hezbollah has lost over 140 members since the war’s onset. Israel is using the war as an opportunity to inflict attritional harm against Hezbollah and its allies, focusing on damaging infrastructure and other targets in the area south of the Litani River in southern Lebanon. Additionally, there is political pressure through Western and Arab mediators to relocate Hezbollah forces, or at least a portion of them, to a distance deemed “safe” from the border by Israeli standards. This relocation has been a stated Israeli objective.

In response to these demands, raised by international delegations, Hezbollah has maintained that there will be no discussions until the hostilities in Gaza cease. Israel has not been content with this position and continues to press for further action, including by provocations such as targeted killings and bombings of Hezbollah assets. These acts are aimed at pushing Hezbollah into either withdrawing from the border or engaging in an escalation it does not want.

Strikes by Israeli forces inside Syria, including the recent killing of the IRGC commander Sayyed Razi Mousavi, have not yet elicited a proportional response from Iran and its partners, highlighting a stark contrast with the deterrence balance in southern Lebanon, where, despite Israeli attacks, Hezbollah maintains a formidable presence. For all its strength elsewhere, there appears to be a notable lack of deterrence by Tehran along its support lines connecting Iraq and Syria.

Despite some initial reports to the contrary, Iran did not want the conflict that began on Oct. 7. But what was previously unthinkable is now a reality, and Iran has to deal with the rapidly altering dynamics of the region. Previously, Iran relied on creating “gray zones” of ambiguity, where it was unclear what response via its proxies would be triggered by Israeli aggression. But the rapid changes in the conflict along the Lebanese border, and now in the Red Sea with the Houthis, mean that Iran can no longer sit back and rely on ambiguity. It is being pushed to the stage where it may have to respond more directly and prove that it is willing to back its fiery rhetoric with action.

These changes suggest a significant shift in the strategic landscape for Iran-affiliated groups, as well as Iran itself. Iran has set ambitious goals for itself and its allies, including reshaping the region politically, expelling the U.S. presence, and directly confronting the powerful Israeli military on multiple fronts. The groups it has armed and trained are ideologically zealous and ready for combat with support from the Quds Force. Yet Iran’s own success at creating this alliance may now prove to be its greatest challenge. Drawn into confrontation by its own militias, Iran may soon be forced to embark on a direct military and political confrontation with the U.S. and Israel that it had neither planned nor immediately desired. The era of ambiguous gray-zone conflict came to an end on Oct. 7. An unprecedented chapter is now opening for Iran and the broader region, from Gaza to Yemen, with reverberations likely to be felt for years to come.

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