U.S. Sanctions Impose Restrictions on Houthi Fuel Imports
New regulations expected to significantly affect Houthi revenue and operational capabilities.
The United States has enacted a decision to prohibit fuel imports through ports controlled by the Houthi movement in Yemen, effective as of today.
Yemeni sources estimate that this action could lead the Houthis to lose approximately two billion dollars annually from this sector, in addition to another billion from their monopoly on logistical services for humanitarian organizations.
This U.S. decision terminates a temporary license that had allowed the offloading of petroleum products at the Houthi-controlled ports of Al-Hudaydah and Ras Issa, which were imported prior to March 5. The regulations further include a ban on the resale or export of refined petroleum products from their areas of control and prohibit financial transactions with entities listed under sanctions, with the exception of payments related to taxes, government fees, and public services.
According to governmental and economic estimates, the Houthis will lose direct revenues from customs fees and taxes on petroleum derivatives.
They will also miss out on significant quantities of these derivatives at reduced prices, often procured through the smuggling of oil from countries under U.S. sanctions or receiving free shipments of cooking gas by manipulating country of origin data.
A report from the Initiative for Recovering Stolen Funds details that the Houthis garnered around 789 million dollars in revenue from the Al-Hudaydah, Salif, and Ras Issa ports between May 2023 and June 2024, derived from taxes and customs fees imposed on imports of petroleum derivatives and other goods.
The breakdown includes 332.6 million dollars from petroleum import taxes, 173.9 million dollars from diesel, and 95.7 million dollars from cooking gas, which is considered a critical source of income for the Houthis, as they obtain it for free, according to informed government sources.
Yemeni authorities have consistently asserted that the three Al-Hudaydah ports have become a key channel for the smuggling of weapons and financing hostile activities, which in turn has contributed to heightened prices for basic commodities, said to have increased by as much as 40 percent due to these levies.
Contrary to the provisions of the Stockholm Agreement, which mandated that revenues from the Al-Hudaydah ports be deposited in a special account at the central bank of Yemen's Al-Hudaydah branch and dedicated to paying state salaries, the Houthis have breached this agreement, seizing those revenues to finance their military efforts.
In addition to these anticipated losses, data indicates that the Houthis stand to forfeit hundreds of millions of dollars they previously received by monopolizing logistics services for international humanitarian organizations, holding control over work permits in this sector or using the capabilities of the state apparatus they have appropriated for such purposes.
Yemeni sources estimate that this action could lead the Houthis to lose approximately two billion dollars annually from this sector, in addition to another billion from their monopoly on logistical services for humanitarian organizations.
This U.S. decision terminates a temporary license that had allowed the offloading of petroleum products at the Houthi-controlled ports of Al-Hudaydah and Ras Issa, which were imported prior to March 5. The regulations further include a ban on the resale or export of refined petroleum products from their areas of control and prohibit financial transactions with entities listed under sanctions, with the exception of payments related to taxes, government fees, and public services.
According to governmental and economic estimates, the Houthis will lose direct revenues from customs fees and taxes on petroleum derivatives.
They will also miss out on significant quantities of these derivatives at reduced prices, often procured through the smuggling of oil from countries under U.S. sanctions or receiving free shipments of cooking gas by manipulating country of origin data.
A report from the Initiative for Recovering Stolen Funds details that the Houthis garnered around 789 million dollars in revenue from the Al-Hudaydah, Salif, and Ras Issa ports between May 2023 and June 2024, derived from taxes and customs fees imposed on imports of petroleum derivatives and other goods.
The breakdown includes 332.6 million dollars from petroleum import taxes, 173.9 million dollars from diesel, and 95.7 million dollars from cooking gas, which is considered a critical source of income for the Houthis, as they obtain it for free, according to informed government sources.
Yemeni authorities have consistently asserted that the three Al-Hudaydah ports have become a key channel for the smuggling of weapons and financing hostile activities, which in turn has contributed to heightened prices for basic commodities, said to have increased by as much as 40 percent due to these levies.
Contrary to the provisions of the Stockholm Agreement, which mandated that revenues from the Al-Hudaydah ports be deposited in a special account at the central bank of Yemen's Al-Hudaydah branch and dedicated to paying state salaries, the Houthis have breached this agreement, seizing those revenues to finance their military efforts.
In addition to these anticipated losses, data indicates that the Houthis stand to forfeit hundreds of millions of dollars they previously received by monopolizing logistics services for international humanitarian organizations, holding control over work permits in this sector or using the capabilities of the state apparatus they have appropriated for such purposes.
