DUBAI -- Saudi-backed Yemeni President Abd-Rabbu Mansour Hadi on Thursday ceded power to a council whose members form the core of an anti-Houthi alliance as Saudi Arabia looks to exit a costly war that has strained Washington's ties with Gulf allies.

WHY DOES THIS MOVE MATTER?

The war is a multifaceted one and Saudi Arabia has struggled to hold together Yemeni factions under the military alliance assembled to fight the Iran-aligned Houthis, the de facto authorities in the north. Political infighting also complicates UN-led efforts to revive negotiations to end the war.

The move aims to unify anti-Houthi ranks by giving more parties a say and sidelining divisive figures -- Hadi and his dismissed deputy, a top general who in the past fought both the Houthis and southern separatists.

Hadi, who failed to build a power base of his own, has been in exile in Saudi Arabia since 2015, and his government has contended with separatists for control of the south while the Houthis control most populated areas of Yemen.

Hadi's government has been criticized by coalition partner the United Arab Emirates, which largely ended its presence in Yemen in 2019 but holds sway through local militias.

It remains to be seen whether the myriad factions, including the Houthis, can put aside their own agendas and mistrust to enter into political negotiations stalled since late 2018.

WHY NOW?

Saudi Arabia is fatigued by a costly war that had been in military stalemate for years and is a sore point with U.S. President Joe Biden's administration, which recalibrated ties with Riyadh due to the 2018 murder of journalist Jamal Khashoggi.

Violence recently spiraled with intense Houthi missile and drone strikes on Saudi oil facilities and assaults against the UAE. This followed big gains by the Houthis in energy-rich Marib last year. Coalition airstrikes on Yemen ramped up in response.

"The council's appointment points to how unsustainable the status quo had become, particularly after Houthi breakthroughs in central Yemen last year," said Peter Salisbury, a senior analyst at International Crisis Group.

"There was a sense that without some big changes the Houthis would eventually win the war."

Washington last year ended support for coalition offensive operations and revoked a terrorist designation on the Houthis due to concern over aid flows, drawing the ire of Riyadh and Abu Dhabi who are also frustrated by conditional U.S. arms sales.

WHAT ARE THE PROSPECTS FOR PEACE?

The situation remains fragile and it is not clear whether the warring sides will opt for talks or try to secure military gains ahead of any negotiations, jeopardizing a rare two-month truce brokered by the United Nations that began on Saturday.

The Houthis have been trying since last year to take full control of Marib, the government's last stronghold in North Yemen and home to major gas and oil resources.

It is also uncertain whether the new council will be able to maintain cohesion given Yemen's fractious history.

The UN envoy is still pressing for a permanent ceasefire and inclusive talks to end the conflict which has killed tens of thousands, pushed millions into hunger and left 80% of the population of some 30 million reliant on aid.

WHO IS ON THE COUNCIL

  • Council head Rashad Al-Alimi, based in Riyadh since 2015, is a former interior minister, from Taiz, who worked closely with the Saudis on security, and is also an Islah Party ally.
  • Sultan al-Aradah is the governor of Marib who is allied with major political bloc Islah, the backbone of Hadi's government.
  • Abdullah al-Alimi, based in Riyadh, was a director of Hadi's office and is an Islah Party member.
  • UAE-backed Aidarous al-Zubaidi, who moves between Yemen and the UAE, heads the separatist Southern Transitional Council.
  • UAE-backed Tareq Saleh is a nephew of former president Ali Abdullah Saleh, who was killed by the Houthis in 2017 while attempting to switch allegiances. He is mostly based in Yemen.
  • UAE-backed Faraj al-Bahsani, the governor of Hadramout.
  • UAE-backed Abdulrahman al-Mahrami, commander of the Giants Brigade which helped expel the Houthis out of energy-rich Shabwa earlier this year. He moves between Yemen and the UAE.
  • Othman Majli, in Riyadh since 2015, is a tribal leader from the Houthi northern stronghold of Saada and a member of the General People's Congress.

(Reporting by Ghaida Ghantous and Mohammed Ghobari in Aden; Editing by Kirsten Donovan)