Escalation in Yemen has intensified since October 2026, with Houthi forces launching repeated missile and drone strikes on Saudi targets including Riyadh, prompting Saudi-led coalition interceptions and airstrikes in response. An informal 2022 truce has unraveled amid these cross-border attacks and ground fighting in areas such as Marib, Taiz, and al-Jawf. Diplomatic channels remain active, including recent UN-brokered prisoner-swap discussions that Houthis described as near agreement—potentially involving hundreds of detainees and a temporary halt to strikes—though Yemen’s recognized government and UN officials stated no final deal exists. Earlier reports of Saudi financial proposals mediated by Iran have not produced confirmed outcomes, while the UN Security Council extended sanctions on the Houthis and urged negotiations. These developments shape trader assessments of whether a broader ceasefire announcement will materialize amid ongoing hostilities and mediation efforts.