A burgeoning strategic rivalry between Saudi Arabia and the United Arab Emirates is having profound effects on the Red Sea region, extending far beyond the immediate battlefield in Yemen to influence broader geopolitical alignments and European economic interests.

What began as a close partnership between two of the Gulf’s most powerful states has in recent months evolved into a public contest over influence, military strategy and control over strategic corridors, complicating regional stability at a time when the Bab-el-Mandeb Strait and surrounding trade routes are already under pressure from other regional conflicts.

At the heart of this transformation lies Yemen’s southern theatre, where UAE-backed separatist forces of the Southern Transitional Council seized control of key governorates in late 2025, prompting a forceful response from Riyadh.

Saudi airstrikes on a shipment allegedly linked to the UAE at the port of Mukalla marked a dramatic escalation, and in early January the internationally recognised Yemeni government — supported by Saudi Arabia — declared a state of emergency and ordered the withdrawal of remaining Emirati forces.

The Southern Transitional Council, which had pursued self-rule objectives with UAE backing, was dissolved following a rapid advance by pro-government forces, and its leader fled to the Emirates.

These clashes reflect deeper fissures in what was once a united anti-Houthi coalition and expose widening strategic divergences between the two Gulf powers.

The rivalry has implications that ripple into the wider Red Sea region.

Analysts note that fractures in Gulf unity diminish coordinated pressure on the Iran-aligned Houthi movement, raising the prospect of renewed threats to commercial shipping and global energy flows through chokepoints such as the Bab-el-Mandeb Strait, a critical artery for oil and trade between the Persian Gulf and Europe.

A divided approach to maritime security presents fresh challenges for regional stability, particularly as Iranian proxies signal potential resumption of attacks on international vessels and Western naval forces, including a U.S. aircraft carrier strike group, are deployed to deter escalations.

For Europe, where trade routes through the Red Sea account for significant volumes of exported and imported goods as well as petroleum shipments, the Saudi–UAE split poses practical and strategic dilemmas.

With traditional Gulf cooperation diminished, Europe may need to engage more actively in maritime security frameworks to protect connectivity and economic corridors that are critical to its trading interests.

The disruption of projects such as the India-Middle East-Europe Economic Corridor — designed to link ports and land routes from the Gulf to Europe — underscores how intra-Gulf tensions can impede broader economic integration and diversification efforts.

European policymakers are now weighing how to balance bilateral engagement with Riyadh and Abu Dhabi while reducing risks associated with fragmented Gulf dynamics.

Beyond Yemen and the Red Sea, the rivalry also plays out in competing regional initiatives, from port investments in the Horn of Africa to differing alignments on political settlements in countries such as Sudan and Somalia.

Saudi Arabia’s preference for state-centric stability contrasts with the UAE’s engagement with autonomous actors and alternative governance models, intensifying contestation over how the Red Sea and its surrounding hinterlands should be governed and defended.

As 2026 unfolds, the strategic competition between Riyadh and Abu Dhabi is likely to remain a defining factor in Gulf geopolitics, affecting not only Middle Eastern security architecture but also European economic and strategic calculations.