Kuwaiti emir intervenes in crucial Yemen peace talks
Sabah urged both sides to continue the discussions to "reach positive results" and safe the country from further war.
The Gulf leader is now taking a front seat role to rescue talks after Yemen's Prime Minister Ahmed bin Dagher rejected a proposal from Houthi rebels to form a unity government.
Dagher has frequently accused the rebels of pushing Yemen's economy to the brink of collapse. He also reiterated the government's policy that peace will only arrive if Yemen returns to the status quo before the Houthi takeover of the capital Sanaa in September 2014.
During a cabinet meeting on Wednesday, Dagher criticised "those who want a national unity government before handing over the weapons". He also said that the Houthis and loyalists of former President Ali Abdullah Saleh has dipped into $3 billion of the country's reserves for the rebels "war efforts".
"[Yemen is] in a terrible state of economic and monetary collapse," he warned.
Dagher insisted that the Houthis surrender their arsenal of weapons and withdraw from territories seized since September 2014.
A sign that Yemen could fall back to a state of full-blown war was seen in the capital on Wednesday.
Religious leaders in Houthi-controlled Sanaa called for "jihad" against the "American invaders in south Yemen", referring to forces allied to the country's internationally-recognised government based in Aden.
Yemen's peace talks have shown signs of fragility since they began in Kuwait on 21 April.
On Tuesday, the government delegation threatened to pull out of the negotiations for a second time, giving the UN envoy a "last chance" to force the Houthis to comply with UN resolutions.
Meanwhile, more than 6,400 people have been killed and 2.8 million displaced in Yemen since a Saudi-led coalition launched a war on Houthi rebels in March last year.