What if the Houthis close the Bab-el-Mandeb strait entirely?
Full closure of Bab-el-Mandeb halts Suez-bound trade, forcing Cape rerouting — Brent +6, distillates and jet bid on the longer voyages, equity sells. Direct analogue: the 2023-24 Houthi campaign plus the 2021 Ever Given Suez blockage, both of which spiked freight and refined-product cracks more than flat crude. Transmission hits Europe-Asia container and tanker flows hardest; the forward angle is that diesel/jet crack spreads and tanker rates (longer ton-miles) are the cleaner trade than outright Brent.
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The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (electric blue) over time vs the market's (Polymarket, amber), from the past toward the 0–6 months horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. Loading the probability audit trail…
What it would mean
If this plays out, it is a risk-off shock. Sustained Houthi drone-and-missile campaign halts virtually all commercial transits through the Bab-el-Mandeb strait. The trigger decomposes into signed root‑shocks — Geopolitical risk ▲ · Oil supply risk ▲ — which propagate through our causal graph to the markets below.