Yemeni government-aligned forces, including the Southern Giants Brigades, reportedly recaptured Perim Island and surrounding positions in the Bab al-Mandeb Strait on October 9, 2026, following Houthi seizure of the island and nearby Red Sea coast in early September. This rapid reversal, supported by geolocated footage and military statements, has shifted trader focus to whether anti-Houthi control will consolidate or face successful counteroffensives, naval reinforcements, or missile/drone pressure from remaining Houthi positions along the coast. Ongoing operations under names like Operation Dawn of Yemen, combined with Saudi air support reports and broader regional tensions involving Iran-backed forces, underpin the market's pricing, where December 31 holds the highest implied probability amid uncertainty over sustained territorial changes. Scheduled military and diplomatic developments through year-end could further influence outcomes.