Irregular: Peace out
Introducing a new format and our top Middle East expert.
Hello from Sydney,
Welcome to Irregular, where I’ll be sharing insights that don’t always make it into our daily briefings, focusing on the most extraordinary and important topics shaping the world today. As the name suggests, Irregular doesn’t follow a fixed schedule—it arrives when there’s something truly critical to discuss, giving you timely insights exactly when they matter most as well as updates about what we’re doing as a firm.
This week, our focus is on the escalating tensions between Israel and Iran—an issue top of mind for our clients and one I have been advising on with Heidi Venamore, our Senior Middle East Advisor and former Australian ambassador to Jordan and the UAE, who has also served in Israel and Palestine.
Unsurprisingly, our clients are laser-focused on recent developments, particularly Israel’s targeting of Hezbollah’s senior leadership, its movements into Lebanon, threats of direct attacks on Iran, and potential Iranian retaliation. All of this raises concerns about the likelihood of a broader conflict and the impacts on business in the region.
Given the opacity and complexity of the situation, combined with often sensationalist media coverage and the uncertainty surrounding the upcoming US election, it’s no wonder global corporations and major investors are seeking clarity.
In light of this, I wanted to share some of our key assessments:
Despite the conflict spreading from Gaza to Lebanon, at its core, this remains a proxy war between Israel and Iran. Iran’s goal is to keep Israel and the West off balance. And Israel’s goal is to ensure maximum security.
A durable peace—whether between Israel and Hamas or Israel and Hezbollah—will only be possible if Israel feels secure. This will happen when Iran ceases to be a major threat, stops supporting proxies like the Houthis, and when Israel’s political landscape evolves to allow some form of Palestinian self-determination.
Neither condition seems likely in the near future. Iran, despite its relatively restrained attacks to save face, has little incentive to change its stance. And Israel, buoyed by military successes and the lack of pressure from the US, is unlikely to embrace Palestinian self-determination.
As a result, we assess the chances of a negotiated peace in the coming months—or even years—as low. While a concerted diplomatic effort involving the US, key European countries, the Gulf monarchies, Egypt, and Jordan might pull Israel and Iran back from a direct conflict, a long-term solution remains distant. And with the US election looming, effective diplomacy is unlikely until a new administration settles, which could take even longer than usual.
More probable than a peace deal is the risk of direct conflict between Israel and Iran, though we still see this as unlikely. Iran, weakened by Israel’s consistent military victories over its proxies, is probably not ready for outright war, which would undermine its core foreign policy goals. Many within the Iranian Revolutionary Guards, who control much of the economy, have personal stakes in avoiding a conflict that would damage their interests.
Israel, however, may assess its situation differently. Following successes in Gaza and Lebanon, it could view now—or soon—as the best time to neutralise the Iranian threat. That said, neutralising Iran need not involve military strikes. As we noted in our Wednesday brief, a weakened and isolated Iran could be achieved diplomatically. The US, even if distracted, will likely temper Israel’s more aggressive inclinations. And fundamentally, no country in the region wants war.
Of course, firm predictions in Middle Eastern politics are perilous and logic of escalation is unpredictable. That’s why we've been working with clients to develop probabilistic scenarios for the next six months, identifying key triggers that could signal different outcomes. And why we provide ongoing services to help map, monitor and manage geopolitical risks for companies and investors with a stake not just in the region but in the broader global economy.
If you found these insights valuable, you’re only seeing part of the picture. Paid subscribers get access to all five daily stories, while GD Professional members enjoy even more— a Saturday essay drawing together the most important themes of the week plus five things to watch for in the week ahead as well as exclusive monthly webinars, including with our senior advisors. If you want to stay fully informed on global developments and geopolitical risks that impact your business, I encourage you to upgrade today.
We’re also helping several major corporations and investors map, monitor and manage their geopolitical risk. If you’d like to know more about our consulting services and how we can help you, reach out to schedule a private consultation and I would gladly talk you through our services in more detail.
I look forward to continuing the conversation in future editions of Irregular, where I’ll share more behind-the-scenes updates on our work and exclusive insights from our senior team.
Best regards,
CEO, Geopolitical Strategy
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How can you make such an article, do you know what you are talking about ? You should never speak about politics, are you in a Israeli payroll ? Sad to see such a person very far from the reality and the truth.