Global Risk Indexes (05-03-2025)

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

Farid al-Khaleqi

Navigating the Sands of Time, Illuminating the Geopolitical Horizon

Middle East in Crisis: West Bank Expulsions, Gaza Aid Blockade, and U.S.-Houthi Conflict Escalate Regional Tensions

The Middle East is at a breaking point, as military conflicts, economic instability, and diplomatic shifts converge. Israeli forces have intensified operations in the West Bank, pushing further into Jenin and demolishing homes, roads, and infrastructure. Tens of thousands of Palestinians have been displaced, raising concerns that this could be the start of a larger clearance strategy.

Meanwhile, the humanitarian crisis in Gaza has worsened, with Israel blocking all aid shipments while ceasefire talks remain deadlocked. Hamas insists on implementing the next phase of the truce, which would see more hostages released in exchange for additional Palestinian prisoners, but Israel has refused to move forward without further concessions.

At the same time, the U.S. has formally designated the Houthis as a foreign terrorist organization. The move is expected to increase economic pressure on the Yemeni group, but it also raises concerns about maritime security in the Red Sea. The Houthis have already warned that they will retaliate against U.S. and allied shipping if their operations are restricted.

In a major diplomatic development, Russia has offered to mediate between the U.S. and Iran, as nuclear tensions reach a critical stage. This comes as Iran dramatically accelerates uranium enrichment, prompting fears of an impending military strike by Israel or the U.S.

Adding to Iran’s challenges, Britain has placed the IRGC under enhanced scrutiny, citing concerns over Tehran’s covert operations in the UK. This follows a series of alleged Iranian plots targeting dissidents and journalists in Europe, signaling a broader crackdown on Iran’s influence networks.

On the diplomatic front, Egypt is leading an effort to push forward a Gaza reconstruction plan, which has been adopted by Arab leaders but rejected by Israel and the U.S. The plan counters Trump’s “Middle East Riviera” proposal, which envisions the displacement of Palestinians and a U.S.-led redevelopment of Gaza.

Meanwhile, Syria’s new government is facing internal security challenges, as clashes between government forces and armed groups in Latakia expose cracks in the regime’s control. The situation is particularly sensitive, given that Latakia was a stronghold of the former Assad government.

In the economic sphere, Saudi Arabia and the UAE are facing increased financial pressures, with stock market declines linked to U.S. trade tensions and falling oil prices. OPEC’s decision to raise production has failed to stabilize the market, as concerns over weak demand and global trade conflicts weigh on investor sentiment.

Israeli Military Expulsions in the West Bank

The Israeli military has demolished large sections of Jenin and forced tens of thousands of Palestinians to flee, raising fears of a broader clearance strategy. With reports of increased troop deployments, the situation remains volatile.

Gaza’s Humanitarian Crisis Escalates

Israel’s blockade on aid has left humanitarian groups warning of a complete collapse of food and medical supplies. The failure to advance ceasefire talks has further exacerbated tensions.

U.S. Designates Houthis as a Foreign Terrorist Organization

The U.S. has officially reclassified the Houthis as a foreign terrorist group, triggering concerns over further instability in Yemen and increased attacks on Red Sea shipping routes.

Russia Offers to Mediate U.S.-Iran Nuclear Talks

Moscow has positioned itself as a potential intermediary between Washington and Tehran, as nuclear tensions escalate. While the U.S. remains skeptical, Russia’s growing ties with Iran make it a key player in any potential negotiations.

Strategic Outlook

The Middle East remains at a critical inflection point. The Israeli-Palestinian conflict is at risk of escalating further, the U.S. is tightening economic and military pressure on Iran and the Houthis, and Russia is maneuvering to play a larger diplomatic role in the region. With economic instability in the Gulf adding another layer of uncertainty, the coming days will determine whether the region moves toward further escalation or a fragile diplomatic reset.

Geopolitical Risk Assessment for the Middle East
(05-03-2025)

The Middle East is witnessing an intensification of military conflicts, diplomatic maneuvers, and economic instability. Israel’s military operations in the West Bank have escalated, with Jenin witnessing mass displacements and widespread destruction. Meanwhile, the Gaza ceasefire remains fragile as Israel continues to block aid, and Hamas insists on advancing to the next phase of negotiations. The U.S. designation of the Houthis as a foreign terrorist organization raises concerns about Red Sea security and Yemen’s worsening humanitarian crisis. Russia has stepped in, offering to mediate between the U.S. and Iran, as nuclear tensions reach a critical stage, while Britain has escalated its scrutiny of Iran’s covert activities. Egypt’s diplomatic push for a Gaza reconstruction plan has gained traction, directly challenging Trump’s controversial “Middle East Riviera” proposal. Syria’s new Islamist-led government is struggling with internal security challenges, as clashes in Latakia expose its fragile control. Saudi Arabia and the UAE are facing economic pressures, with stock market declines linked to U.S. trade tensions and falling oil prices. With ongoing conflicts, shifting alliances, and economic disruptions, the region remains at its highest level of geopolitical risk.

Geopolitical Risk Index

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

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