The Israeli ground offensive, if it starts, is likely to spread tension to the Gulf and also has the potential to severely impact international markets and struggling economies around the globe, according to Paul Salem, President and CEO, Middle East Institute.
Washington is busy trying to limit the fallout of the war but amidst the inflamed public opinion in the Arab and Muslim worlds, the U.S will be tied to whatever decisions the Israeli government takes in the coming weeks and months, Salem said.
He said that it is clear that this is not just a war between Israel and Hamas but in many ways a war between Iran and Israel as well.
Although Tehran is not directly involved but its support for Hamas and the decisions ultimately taken by the Hezbollah and other allied militias in Syria, Iraq, and Yemen are part of this growing conflict.
The highest risk remains the full eruption of a “second front” along the Lebanon-Israel border and also along the Israeli border with Syria.
Iranian Foreign Minister Hossein Amir-Abdollahian and Hezbollah have indicated quite clearly that they might open a second front if Israel does not stop its war in Gaza. Their “red lines” are not fully clear, however, there has already been large-scale bloodshed in Gaza, and Hezbollah attacks have also escalated along the Lebanon-Israel border, though in a limited fashion, Salem said.
He said that Iran, Russia, and China all must be satisfied with the regional political reverberations of the war. Iran perhaps has the most to gain -- and the most to lose. In its policy of brinksmanship against Israel and the U.S., it might get away with it, if Hezbollah remains intact and Iran or its proxies don’t suffer many losses.
He said that Hamas and Gaza are already paying a heavy price for the attack and it is quite possible that Hezbollah and Lebanon might be consumed in a conflict with Israel as well.
He said that the higher risk is that these tensions may spill over into the Gulf, either through some form of attack on Iran itself or in a renewed tightening of oil sanctions against Iran.
He said that the so far, the conflict has not affected energy prices or the global economy directly; but if conflict spills over into the Gulf, the reverberations of this “local” war will start to severely impact international markets, especially struggling economies and populations around the world -- just as the Russian war in Ukraine has done since early 2022.
From Lebanon to Yemen, Syria and Iraq, the Iran-led regional axis of which Hamas is also a part is moving into position. Some of its component militias have already entered the war theater.
Director of Research at the Middle East Forum Jonathan Spyer wrote in The Australian that others have arrived at their jump-off points, awaiting the order to intervene.
He said that it's important to understand the nature of the alliance in question. It is the fruit of the methodology and the investments of Iran's Islamic Revolutionary Guards Corps during the past four decades in the Middle East.
Spyer said that Tehran has built an army of a type never seen before in the Middle East and that is now preparing for action.
He said that it is a unique melding of regular and irregular capacities, and of the political with the military. Most crucially, the IRGC method weds the Islamist fervour from below that remains the dominant force across the Arab world at street level, with the capacities, armaments and organisation that can be supplied only by a powerful state.
He said that this is what the mobilisation of this army looks like: On Israel's border with Lebanon, the Hezbollah organisation that is Lebanon's de facto ruler is launching Kornet antitank missiles, drones and rockets at both military targets and civilian communities every day.
Spyer said that in Syria, the Iran-supported militias that defeated the rebellion of 2012-19 are once more on the move. From their positions in the deserts of Deir al-Zor province in the country's east, they are heading west, toward Deraa and Quneitra provinces, adjoining the Golan Heights.
He said that in recent years, Iran has carved out an area of its exclusive control that stretches from the al-Qaim-Albukamal border crossing between Iraq and Syria to Syria's border with Israel.
Exclusive means the IRGC doesn't need the permission of the nominal ruler of Syria, Bashar al-Assad, to move its pieces across the board. It is along this area of control that the militias, with Iraqi, Syrian and Lebanese fighters chief among them, are making their way, from the border crossing to the town of Mayadeen, exclusively controlled by the IRGC, and then onwards west.
Spyer said that across the border in Iraq last week, Kata'ib Hezbollah, the most powerful of the Iran-led militias in that country, and its allied organisations launched drone and rocket attacks at three sites where US troops are present: the Ain al-Asad air base, Baghdad International Airport and the al-Harir base in Iraqi Kurdistan. The Badr Organisation, largest of the militias in Iraq, issued a statement threatening further attacks.
He said that the political element here is once again no less crucial than the military one. These militias are not independent forces operating out in the wilderness. Rather, in their other form as political parties, they form the central core of the government of Iraqi Prime Minister Mohammed Shia al-Sudani. Indeed, Iraqi National Security Adviser Qassem al-Araji is a veteran member of Badr.
Even as far afield as Yemen, Iran's Houthi allies appear to have tried to launch missiles at Israel on last Thursday. The Houthis, again, control the Yemeni capital of Sanaa and a large swath of the country.
From Yemen’s rebels launching missiles to alleged Israeli settler killings of Palestinians in the West Bank, the entire region faces chaos, Politico reported.
The U.S officials are worried that violence in Israel’s neighbors will spiral into a larger regional war. Biden administration officials are especially concerned that armed groups backed by Iran are preparing to exact more bloodshed. Aside from Hamas, those proxy forces include Lebanon and Iraq-based Hezbollah and the Houthis of Yemen, Politico reported.
American troops in a variety of locations across Iraq and Syria have already come under attack from drones and rockets more than a dozen times in the past week.
There are also concerns that the attacks can expand beyond Iraq and Syria -- which host 2,500 and 900 American troops, respectively -- to the thousands of other U.S personnel stationed across the region, from Bahrain to the United Arab Emirates. Even commercial vessels in the Persian Gulf can come under increased threat, according to a U.S. official, Politico reported.
Israel has been evacuating villages near the border amid rocket launches and concerns about militant incursions Politico reported.
Dozens of Palestinians have been killed in the West Bank since Hamas’ attack on Israel.
Many are suspected to have died at the hands of Israeli settlers who reside in the territory and may be taking advantage of the moment to sow fear in Palestinian communities and try to take their land, Politico reported.
U.S. officials are very worried that clashes in the West Bank could turn into a more serious conflict, said Jon Alterman, an analyst with the Center for Strategic and International Studies, Politico reported.
Few expect a new round of pro-democracy demonstrations like the Arab Spring, but the potential for violence — from protesters or the state — remains as high as the emotions inspired by the Israel-Hamas war.
An Arab diplomat acknowledged the challenge posed by protests, but argued that should the government in charge remain steadfastly on the side of the Palestinians, its people would only support it more.
“The protests will continue and there will be a very strong pressure on the authorities and on the leaders,” the diplomat said. “When it comes to the Palestinian cause … it’s a common cause. It’s in our blood,” Politico reported.
The Hamas attack may breathe new life into Islamist extremist movements whose cause had been getting less attention given the growing international focus on Russia’s war on Ukraine and America’s rivalry with China.