Global Risk Indexes (03-02-2025)

Global 98 (0 —)
MENA 96 ( —)
APAC 98 (+1 ▲)
Europe 99 ( —)
Africa 97 (-1 ▼)
AMERs 98 ( —)
Markets 98 (-1 ▼)
Farid al-Khaleqi, Middle East region analyst at Worldwise Analytica

Farid al-Khaleqi

Navigating the Sands of Time, Illuminating the Geopolitical Horizon

Gaza Ceasefire Tested, West Bank Erupts, and Lebanon's Political Vacuum Deepens: MENA's Volatility Persists

The Middle East remains in a precarious state as Israel escalates military actions in Gaza and the West Bank, Lebanon's instability worsens, and Syria's transitional government faces mounting economic and security challenges. Amid shifting alliances and continued maritime threats, the region is at a strategic inflection point.

The Gaza ceasefire remains under strain as Israel and Hamas accuse each other of violations. An Israeli airstrike on a 'suspicious vehicle' outside the designated ceasefire inspection route has raised further concerns about the truce's sustainability. Meanwhile, Hamas has accused Israel of stalling on humanitarian aid deliveries and failing to fully implement the agreement. The phased release of hostages continues, with Hamas handing over three Israeli captives in exchange for 183 Palestinian detainees, but Israeli hardliners are calling for a halt to further negotiations. The second phase of ceasefire talks, set to begin this week in Washington, will be a critical test of whether the truce can lead to a long-term political resolution or collapse into renewed hostilities.

In the West Bank, tensions have escalated dramatically following the Israeli military's expansion of operations in Jenin and the surrounding areas. At least 25 Palestinians have been killed in Israeli raids over the past two weeks, and the demolition of 20 buildings in the Jenin refugee camp has displaced thousands. Hamas has called for an 'escalation in the resistance,' signaling the possibility of a renewed intifada. Israel views the West Bank as part of a broader 'multi-front war' against Iranian-backed groups, but its actions risk exacerbating Palestinian anger and fueling wider regional instability.

Lebanon's political and economic crisis continues to deepen, with Hezbollah's leadership reaffirming its commitment to resisting Israeli airstrikes. The recent killing of top Hezbollah commanders, including Hassan Nasrallah's successor Hashem Safieddine, has left the group in internal disarray. The upcoming public funeral for Nasrallah on February 23 is expected to serve as both a display of strength and an opportunity to consolidate Hezbollah's leadership structure. Meanwhile, the UAE's Al Habtoor Group has withdrawn all planned investments from Lebanon, citing Hezbollah's dominance and economic mismanagement. The fragile ceasefire along the Israel-Lebanon border is at risk, with both sides trading accusations of violations, and the situation could rapidly escalate if Hezbollah seeks revenge for its losses.

In Syria, the transitional government under Ahmed al-Sharaa is attempting to rebuild international ties, with the Syrian leader making his first foreign visit to Saudi Arabia. His meeting with Crown Prince Mohammed bin Salman marks a shift in regional alliances, as Riyadh appears willing to support the new government in exchange for commitments to curb extremism and the captagon trade. However, Syria's economic crisis remains a major challenge, with Iran reportedly halting fuel shipments and black-market prices soaring. The country's long-term stability remains uncertain, particularly as hardline Islamist groups seek to capitalize on the transitional period.

Maritime security in the Red Sea remains a key concern as the Houthis continue to pose a threat to international shipping. A recent attack on the Khor Mor gas field in Iraq's Kurdistan region, though causing no damage, highlights the broader risks of spillover conflicts. Meanwhile, Turkey's military operations in northern Syria, which have resulted in the deaths of 23 Kurdish fighters, reflect Ankara's ongoing campaign against the YPG and PKK. Turkey's foreign minister has openly called on U.S. President Trump to end Washington's support for the YPG, but with U.S. troops still stationed in Syria, any shift in policy remains uncertain.

On the economic front, Turkey's manufacturing sector is facing a downturn, with the PMI index dropping to 48, signaling contraction. Rising inflationary pressures and currency depreciation have contributed to weaker demand, complicating Ankara's economic outlook. Meanwhile, in the Gulf, Abu Dhabi's TA'ZIZ has awarded a $1.7 billion contract to Samsung E&A to build the UAE's first methanol plant, a move that underscores the UAE's broader strategy to expand its chemicals sector and reduce oil dependency.

Strategic Implications: The region remains in a fragile equilibrium where multiple crises intersect. The Gaza ceasefire is under strain, West Bank tensions could escalate into a broader conflict, and Lebanon's political vacuum is exacerbating economic woes. Syria's transition remains uncertain, while maritime security risks continue to impact global trade. External actors, particularly the U.S., Saudi Arabia, and Turkey, will play key roles in shaping whether the region moves toward de-escalation or deeper instability.

Geopolitical Risk Assessment for the Middle East
(03-02-2025)

MENA remains on edge with Gaza's fragile ceasefire facing political and security obstacles, the West Bank nearing an uprising, Lebanon's instability deepening, and Syria's transitional government struggling with economic uncertainty. Regional alliances are shifting, while maritime security threats persist, keeping geopolitical risk at critically high levels.

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