Global Risk Indexes (11-02-2025)

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

Farid al-Khaleqi

Navigating the Sands of Time, Illuminating the Geopolitical Horizon

Trump's Ceasefire Ultimatum Escalates Gaza Tensions, Iran's Economic Crisis Deepens, and Saudi Arabia Accelerates AI Dominance

The Middle East is once again at the center of a geopolitical storm as key flashpoints across the region continue to escalate. U.S. President Donald Trump has issued a blunt ultimatum, threatening to cancel the Israel-Hamas ceasefire if all Israeli hostages are not released by Saturday, warning that he will let 'all hell break loose' if Hamas does not comply. In response, Hamas has suspended hostage releases indefinitely, accusing Israel of violating the ceasefire agreement. With ceasefire negotiations in Qatar at an impasse and Trump pressuring Netanyahu to take stronger action, the risk of renewed military conflict in Gaza has significantly increased. Meanwhile, Jordan's King Abdullah is preparing for a high-stakes meeting with Trump after the U.S. president threatened to cut aid to Jordan and Egypt if they refuse to accept displaced Palestinians from Gaza. Iran's economic crisis is deepening, with the rial hitting record lows as Supreme Leader Khamenei rejects U.S. talks and President Pezeshkian doubles down on anti-American rhetoric. In contrast, Saudi Arabia is accelerating its push to become a global AI powerhouse, securing a $1.5 billion investment in AI chips from U.S. startup Groq and partnering with DataVolt on a $5 billion AI data center project. Trump's new 25% tariffs on steel and aluminum have also triggered fears of a broader trade war, which could have major economic consequences for MENA markets. With tensions rising in Gaza, Iran's economy in freefall, and Saudi Arabia making major technological strides, the region is heading toward an inflection point.

Trump's Ceasefire Ultimatum: A Catalyst for Renewed Conflict?

Trump's demand that Hamas release all remaining hostages by Saturday or face the collapse of the ceasefire has dramatically increased the risk of renewed Israeli military operations in Gaza. Hamas has responded by suspending hostage releases indefinitely, citing alleged Israeli violations of the ceasefire deal. The breakdown in negotiations suggests that both sides are hardening their positions, making a return to full-scale conflict increasingly likely. Netanyahu's government is under growing pressure from the Israeli right wing to abandon the ceasefire altogether and resume military operations. If the truce collapses, Israel may launch a new offensive, further destabilizing the region and increasing the risk of Hezbollah or other Iranian-backed groups joining the conflict.

Jordan and Trump: A Diplomatic Showdown

Jordan's King Abdullah is set to meet Trump in what is expected to be a tense diplomatic confrontation. Trump has threatened to cut aid to Jordan and Egypt if they refuse to accept displaced Palestinians from Gaza, a demand that has been categorically rejected by both nations. Jordan sees Trump's Gaza displacement plan as an existential threat, warning that any forced resettlement of Palestinians would destabilize the Hashemite Kingdom and provoke unrest. If Trump continues to pressure Jordan and Egypt on this issue, it could trigger a broader diplomatic crisis between Washington and its key Arab allies.

Iran's Economic Meltdown: Sanctions and Internal Struggles

Iran's currency has plunged to record lows as U.S. sanctions continue to take their toll. President Pezeshkian and Supreme Leader Khamenei have both rejected any talks with Washington, doubling down on anti-U.S. rhetoric as the economy deteriorates. The currency collapse is exacerbating domestic discontent, with protests growing both inside Iran and abroad. Mass demonstrations in Paris, led by Iranian dissidents and Ukrainian activists, are increasing international pressure on Tehran. If Iran's economic crisis worsens, the regime may resort to more aggressive foreign policies, including escalating its proxy conflicts in the region.

Saudi Arabia's AI Expansion: A New Global Power Shift

Saudi Arabia has made a major move in the global AI race, securing a $1.5 billion investment in AI chips from U.S. startup Groq and launching a $5 billion AI data center project with DataVolt. These investments underscore Riyadh's ambition to position itself as a global AI leader, aligning with Crown Prince Mohammed bin Salman's Vision 2030 strategy. Saudi Arabia's rapid technological expansion could shift economic and geopolitical dynamics, particularly in the growing competition between the U.S., China, and the Gulf states in emerging technologies.

Strategic Outlook

The MENA region is entering a period of severe instability, with multiple crises unfolding simultaneously. Trump's ceasefire ultimatum has dramatically increased the risk of renewed conflict in Gaza, while Jordan's diplomatic clash with Washington could reshape regional alliances. Iran's economic crisis is deepening, with potential implications for both domestic stability and Tehran's foreign policy. Meanwhile, Saudi Arabia's aggressive AI expansion signals a major shift in global economic power. With geopolitical, military, and economic tensions rising, the coming days will be critical in determining the region's trajectory.

Geopolitical Risk Assessment for the Middle East
(11-02-2025)

The MENA region is rapidly approaching a breaking point as diplomatic tensions, economic crises, and military escalations intensify. Trump's threats to cancel the Israel-Hamas ceasefire if all hostages are not released by Saturday have dramatically increased the risk of renewed conflict in Gaza. Hamas has responded by suspending hostage releases indefinitely, citing Israeli ceasefire violations, further raising the likelihood of military escalation. Meanwhile, Jordan's King Abdullah prepares for a high-stakes meeting with Trump after the U.S. president threatened to cut aid to Jordan and Egypt unless they accept displaced Palestinians from Gaza. Iran's economic crisis continues to deepen, with the rial plunging to record lows as Tehran intensifies anti-U.S. rhetoric and rejects any negotiations with Washington. At the same time, Saudi Arabia has secured massive AI investments, reinforcing its ambition to become a global tech leader. Trump's new 25% tariffs on steel and aluminum imports have triggered fears of a global trade war, with potential spillover effects on MENA economies. With Israel signaling military readiness, Hamas hardening its stance, and diplomatic relations deteriorating, the region is on the brink of severe instability.

Geopolitical Risk Index

Developments to Follow for the Middle East (See All Global)

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