Story highlights U.S. reducing embassy personnel because of security concerns, State Department official says

President, prime minister, Cabinet resign, Yemeni officials say

Minister says rebels still hold kidnapped presidential aide despite agreeing to free him

Sanaa, Yemen (CNN) Yemen's President resigned Thursday night shortly after his prime minister and the Cabinet stepped down: seismic changes in the country's political scene that come just one day after the government and Houthi rebels struck a tentative peace deal meant to end days of turmoil.

The resignations of Yemeni President Abdu Rabu Mansour Hadi and other officials are the latest fallout from the Houthis' move in recent days to gain power in the capital, which included kidnapping Hadi's chief of staff on Saturday and taking over the presidential palace on Tuesday.

The chaos in Yemen is cause for concern far beyond the country's borders. For the United States and its allies, Yemen's government has been a key ally in the fight against al Qaeda in the Arabian Peninsula, the Yemen-based group linked to attacks such as the recent slaughter at French magazine Charlie Hebdo.

JUST WATCHED Why chaos in Yemen worries Western nations Replay More Videos ... MUST WATCH Why chaos in Yemen worries Western nations 02:39

The United States responded by reducing embassy personnel in the capital because of security concerns, a senior State Department official said Thursday night. "While the embassy remains open and is continuing to operate, we may continue to re-align resources based on the situation on the ground," the official said.

The Cabinet and Prime Minister Khaled Bahah resigned before Hadi did on Thursday night, with Bahah telling Hadi in a letter that they essentially wanted to wash their hands of "destructive political chaos," an apparent reference to the deal that was to give Houthis more power.