Yemen’s President Abdurabuh Mansur Hadi resigned on Thursday after Shiite Houthi rebels seized his palace and demanded constitutional changes.

Hadi informed the speaker of parliament of his decision, which followed the failure of the rebel fighters to honor an agreement the previous day to withdraw from the palace, his aide Sultan al-Attwani said by telephone. The legislature rejected the president’s resignation, and will hold an emergency session on Friday, Al Arabiya television said.

The departure of the U.S.-backed leader would deepen political turmoil in Yemen that has allowed al-Qaeda to expand its operations there and caused alarm in neighboring Saudi Arabia, the world’s biggest oil exporter.

Hadi, installed as part of a U.S. and Saudi-backed accord in 2012 to end a year of unrest, has struggled to exert authority over much of the country amid challenges by ethnic separatists, political protesters and Islamist militants. Al-Qaeda’s Yemen branch has taken advantage of the power vacuum. It claimed responsibility for this month’s killings at the Charlie Hebdo magazine in Paris, and has sought to attack Saudi and U.S. targets in the past.

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