Possible scenario
Red Sea Truce Frays
30% Chance
The US refueling decision is treated by the Houthis as a breach of the May 2025 understanding. They resume selective maritime threats, increasing risk premia for oil, shipping and regional insurance without immediately closing the Bab al-Mandab route.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +2.6%
Portfolio impact
S&P 500-1.1%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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