Geopolitical escalation tied to the Iran-Israel conflict and the Strait of Hormuz closure since late February 2026 has elevated risks at the Bab el-Mandeb Strait, a chokepoint handling roughly 10-12 percent of global seaborne trade and several million barrels per day of petroleum liquids. Houthi forces aligned with Iran have issued repeated warnings of potential closure or targeted attacks on vessels linked to the U.S., Israel, or their allies, prompting carriers such as Maersk to pause certain Trans-Suez sailings and forcing widespread rerouting around the Cape of Good Hope. These shifts have lifted container freight rates, extended average transit times by multiple weeks, and added war-risk premiums to energy benchmarks, even as daily traffic volumes remain below pre-2023 levels but continue under heightened security vigilance. Trader sentiment reflects the balance between sustained selective enforcement and the potential for broader disruption should regional hostilities intensify ahead of key diplomatic or military developments.