Why Does Saudi Arabia Tolerate the Houthis as a Dagger in Its Side?

The question sounds deceptively simple, but it cuts straight into the structural weakness of how Riyadh thinks about its national security, the limits of power when it is used without strategy, and the illusion that crises can be “managed” rather than resolved. It is not just a question about Yemen and what remains of Iran’s network of militias; it is a question about the future of the Red Sea, the stability of global energy markets, Iran’s ability to maneuver through its proxies, and the strategic vacuum Saudi Arabia has allowed to persist since the first day of the war in Yemen.

The spark for this question came by chance, on a flight, when I found myself seated next to a retired Omani general who had fought in the Dhofar War—a conflict waged by a small army with limited means, yet ultimately won in some of the most difficult mountain terrain in the region. I asked him about Saudi Arabia’s “Decisive Storm” campaign and how it had ended in a suspended reality despite overwhelming Saudi military superiority. His answer was concise: the continued existence of the Houthis as a military and political force is a dagger in Saudi Arabia’s side. It was a powerful line, but not a sufficient explanation.

What has happened to the Houthis over the past decade is not the natural evolution of a local militia. They have become an advanced Iranian arm on Saudi Arabia’s southern border, capable of threatening international shipping, disrupting Riyadh’s alternative to the Strait of Hormuz, driving up global oil prices, and inserting the Red Sea into Iran’s deterrence calculus. Analysts at the Atlantic Council have described how the group has shifted from a domestic insurgency into a strategic tool for Tehran in the Red Sea. Reporting in the New York Times has traced the way Houthi attacks and threats have become part of Iran’s pressure campaign on Washington and Riyadh, particularly in the realm of energy security. The Washington Post has highlighted the growing sophistication of Houthi capabilities—drones, missiles, and small boats—that now allow them to disrupt commercial shipping in ways that would have been hard to imagine a few years ago. And the Financial Times recently framed the current moment as the most serious test of Saudi Arabia’s ability to protect its vital interests since the 2019 attacks on Aramco.

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Since launching “Decisive Storm,” Saudi Arabia has relied on three assumptions: that air power would be enough to subdue the Houthis; that the group could be contained through ceasefires and negotiations; and that the Beijing agreement with Iran would open the door to a broader de-escalation.

Air power did not win the mountain war, as the Omani general knows from his own experience, and it did not break a sectarian movement with external backing fighting in complex terrain. Political “containment” has turned out to be an illusion: a group that is given a truce uses it to upgrade its capabilities; a group that is given a negotiating platform uses it to consolidate its influence; a group that is granted de facto legitimacy uses it to raise the ceiling of its threats. The Beijing agreement, meanwhile, was a temporary pause between Riyadh and Tehran, not a strategic framework that would compel Iran to restrain a proxy that has become one of its most valuable pressure tools against Saudi Arabia.

On the security front, the kingdom’s southern border remains unstable, energy infrastructure remains vulnerable to long-range attacks, and Iran retains the ability to strike inside Saudi territory indirectly and cheaply. Economically, Bab al-Mandab is turning into a second chokepoint after Hormuz; shipping and insurance costs rise, oil prices climb, and global inflationary pressures intensify. Politically, Saudi Arabia’s image as a power capable of settling security files in its immediate neighborhood erodes, while Iran emerges as a state with a military and political foothold on the kingdom’s border—something unprecedented in the modern history of the region.

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The real question, then, is not about the Houthis; it is about Saudi Arabia itself. Why does it accept this dagger? The harsh answer is that Riyadh fears sliding into a war it cannot control, bets on time and diplomacy, and lacks a genuine vision for resolution. But time, so far, has worked in favor of Iran and the Houthis, not against them. Diplomacy has not persuaded an ideologically driven militia to surrender a strategic asset of this magnitude. And there is no clear plan—inside Yemen or outside it—for dismantling Houthi military power or rebuilding a Yemeni state capable of controlling its territory and borders.

A dagger left in the body for too long ceases to be a foreign object; it becomes part of the body’s political anatomy, a fixed variable in strategic calculations. Removing it later will be more painful, more costly, and more dangerous. But leaving it in place means one thing: that Saudi Arabia is willing to let its national security, and a significant portion of global energy security, depend on the decisions of a militia and the calculations of a regional power that exploits every gap in the international system.

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The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.