The late-night agreement, which promises the rebels greater say in running the Arab world’s poorest nation, left unclear who really controls the country, thoughn it requires the Houthi rebels tremove their fighters from President Abed Rabbo Mansour Hadi’s residence and key areas of the capital.

In the deal, reported by the official SABA news agency, the rebels also agreed to release a top aide to Hadi they had kidnapped in recent days.

The Houthis, who seized control of the capital and many state institutions in September, say they only want an equal share of power. Critics say they want to retain Hadi as president in name only, while keeping an iron grip on power.

The power vacuum has raised fears Yemen’s al-Qaida’s branch, which claimed responsibility for the recent attack on a French satirical weekly and is considered by Washington to be the terror group’s most dangerous affiliate, will only grow more powerful as Yemen slides toward fragmentation and the conflict takes on an increasingly sectarian tone. The Shiite Houthis and Sunni terror group are sworn enemies

After days of violent clashes and the seizure of the presidential palace, aides to Hadi said early Wednesday that he was “captive” in his home after Houthi rebels removed his guards and deployed their own fighters.

There was no visible change in Houthi deployment outside Hadi’s house after the agreement was announced Wednesday night.

While the deal stopped short of asserting a Houthi takeover of government, analysts said the rebels had become Yemen’s de facto ruling power.

“The Houthis are in effective control,” said Jamal Khashoggi, a Saudi columnist and observer of Yemen’s affairs. “Even if Hadi agrees to stay president, he no longer controls Yemen and can’t give orders. … The fear is the country will be dragged toward division and infighting.”

Speaking to reporters in Washington, State Department spokeswoman Jen Psaki said, “Clearly, we’ve seen a breakdown in the institutions in Yemen.” However, she added, “the legitimate Yemeni government is led by President Hadi.”

“We remain in touch with him. He is in his home,” she said, adding that Washington’s “ongoing counterterrorism cooperation with Yemen has continued” despite this week’s standoff.

The collapse of Hadi’s powers is rooted in Yemen’s fractured armed forces, torn between Hadi and his predecessor, deposed President Abdullah Saleh.

Saleh — toppled after more than three decades in power following a 2011 uprising — is accused by many of orchestrating the Houthis’ seizure of Sanaa. Critics also say the Houthis also have the backing of regional Shiite power Iran, a charge they deny.