By Barbara Slavin

The Saudi bombing that killed 140 people at a funeral in Yemen earlier this month has given the Barack Obama administration new diplomatic ammunition to push for a halt to an increasingly bloody and counter-productive war.

Meeting in London Sunday with his British counterpart, Boris Johnson, and a UN envoy, Secretary of State John Kerry called for an unconditional cease-fire, saying,  “We cannot emphasize enough today the urgency of ending the violence in Yemen.”

People inspect the aftermath of a Saudi-led coalition airstrike in Sanaa, Yemen, Saturday, Oct. 8, 2016. Yemeni Health Ministry and medical groups say at least 100 people were killed in a Saudi-led coalition airstrike that targeted a funeral hall in the capital, Sanaa. (AP)

Saudi Arabia began bombing Yemen, one of the poorest countries on the planet, in March  2015 to try to restore an internationally recognized government and defeat Houthi rebels who had occupied the Yemeni capital, Sanaa, in 2014. But 18 months later, the Houthis remain in Sanaa, the ousted president has only a tenuous hold in the south and east of the country and the main beneficiary of the conflict has been al Qaeda in the Arabian Peninsula (AQAP).

The war has killed more than 10,000 people including at least 4,000 civilians, driven millions from their homes and left about 80 percent of the population – more than 20 million people – in need of humanitarian assistance. It has turned much of the Yemeni population against both Saudi Arabia and the United States, which is seen as a critical enabler of the Saudi bombing campaign through provision of logistical and intelligence support.

Most ominously, the war has boosted the fortunes of AQAP, which has been a major source of terrorist plots against the United States for more than a decade. According to a recent study by the Jamestown Foundation, “The war in Yemen and the extraordinary destruction that it has wrought have created ideal conditions for an organization that has proven itself to be highly capable and adaptable. The future for AQAP has rarely looked brighter.”

U.S. support for the Saudis was based in part on genuine concern over Houthi missile attacks on Saudi border towns and in part on a perceived need in Washington to reassure Saudi Arabia that the United States was not tilting toward Tehran in the aftermath of last year’s nuclear deal. But increasingly, the Yemen war has become a geopolitical distraction at a time when U.S. forces are focusing on efforts to roll back the Islamic State group in Iraq and Syria.

This image made from video shows a radar site after a U.S. airstrike in Hodeida,Yemen on Thursday, Oct. 13, 2016. US-launched Tomahawk cruise missiles destroyed three coastal radar sites in Houthi-controlled territory on Yemen’s Red Sea Coast early on Thursday, officials said, a retaliatory action that followed two incidents this week in which missiles were fired at US Navy ships. (AP)

Last week, in the aftermath of the Oct. 8 bombing of the funeral, the Houthis, who are supported by Iran, launched missiles against a U.S. destroyer in the Red Sea. The missiles failed to hit the U.S. ship and the Obama administration retaliated by blowing up three radar facilities on the Yemeni coast. On Saturday, the Houthis reportedly tried again to hit the destroyer and failed.

The U.S. retaliation represented the first direct U.S. military involvement in the war. It risks a further alienation of the Houthis who, prior to the U.S. intervention in support of the Saudi bombing campaign, had on occasion cooperated with U.S. intelligence against AQAP.

Alarmed at the rising civilian death toll and AQAP’s growing strength, the Obama administration had already cut back assistance to Saudi forces, according to administration officials, and is now conducting a review of remaining aid.

A senior U.S. official told reporters in a background conference call on Friday that “the strike on the funeral was really, really hard to swallow.  I mean, we thought that that was particularly egregious…”

A second senior administration official, also speaking on condition of anonymity, said there is currently only “a very small remnant of the support that we have [for the Saudis] in their operations center” and some refueling of aircraft but that the Obama administration is “looking at all of it.”

The implicit U.S. threat to stop assistance to Saudi forces in Yemen could convince Riyadh that the time has come to reach a diplomatic solution that gives the Houthis a reasonable share of power.

Making a joint statement on Yemen, with left – right, US Secretary of State John Kerry, British Foreign Secretary Boris Johnson and UN Special Envoy for Yemen Ismail Ould Cheikh Ahmed, at Lancaster House in London Sunday Oct. 16, 2016. The U.S. and Britain expressed hope on Sunday that a cease-fire can be reached in Yemen in the coming days, as a flurry of diplomacy focused on the impoverished, war-torn country. (AP)

Given the rising cost of the war, the Saudis have other compelling reasons to rethink their flagging campaign to restore the government of President Abed Rabbu Mansour al-Hadi. (Hadi asserted last week that the Houthis were responsible for bombing the funeral, but a day later, the Saudi government admitted its own complicity, blaming it on faulty intelligence.)

Faced with low oil prices, a growing population and an over-dependence on oil revenues, the Saudis are cutting salaries, raising utility prices and increasing government debt. Deputy Crown Prince Mohammed bin Salman, the architect of a new economic vision for the country as well as the Yemen war – and the de-facto ruler of Saudi Arabia given the fragile health of King Salman – may be having second thoughts about the wisdom of continuing to pummel Yemen while trying to reinvigorate the Saudi economy.

If a cease-fire takes hold, much of the credit will go to the government of Oman, which has provided neutral territory for negotiators from the Houthis and the Hadi government to meet with the UN Special Envoy for Yemen, Ismail Ould Cheikh Ahmed, a Mauritanian diplomat.

Oman also engineered the release of two unidentified American captives of the Houthis and the evacuation of some Houthis severely wounded in the funeral bombing.

With so much of the Middle East in flames, a curtailment of the Yemen war would be a rare diplomatic achievement.  Let us hope that the Saudis see the wisdom of a cease-fire and that the Houthis and their Iranian backers agree.

Barbara Slavin is Acting Director of the Future of Iran Initiative at the Atlantic Council in Washington. Follow her on Twitter @barbaraslavin1