“In the very short term, it has lowered the risk of more confrontation between Iran and Israel,” Anna Rosenberg, head of geopolitics, Amundi Investment Institute, said in an interview on 9 December 2024. She explained that Iran is severely weakened in the region because of the loss of its land bridge between Iran-Iraq “down to the Golan,” which will limit its capacity to rearm Hezbollah in Lebanon. On the other hand, Israel must secure its border with Syria and ensure that Sunni rebels don’t take possession of the weapons arsenal left behind by the Assad regime.
Russia is opportunistic, like every power in a power competition and it’s about survival
Beyond this temporary period, she thinks that the risk of escalation between Israel and Iran remains “high” as the latter could still “go big” against the former to signal that it continues to be a strong backer of the Axis of Resistance. Besides, Israel may see an enfeebled Iran as a “golden opportunity to strike Iran again and really weaken it even more, to possibly accelerate political change there.”
Yet she thinks that there is a higher likelihood that Iran will “lay low” because it may believe that it will increase its chance of survival given the weakened Axis of Resistance.
Questioned by Paperjam about the risk for Russia of losing its assets in Syria, Rosenberg said that: “Russia is opportunistic, like every power in a power competition and it’s about survival.”
She noted that Iran and Russia grew lukewarm towards Assad because he tried to “rekindle relations to the US again.” Moreover, she observed that the Assad regime also tried to be less dependent on Iran. These developments certainly explain the speedy progression of Hayat Tahrir al-Sham rebels towards Damascus.
Global market risks from Syria’s developments are unchanged
The focus of Amundi is whether any adverse development in the region may have disruptive impact of the oil flow out of the Strait of Hormuz, trade flows or changes to the economic outlook. Rosenberg thinks that the developments in Syria have not changed the status quo. Besides, the base case at Amundi does not foresee a “big lashing out between Iran and Israel.”
Unclear economic impacts for regional countries
Rosenberg thinks that messy developments in Syria, with fighting amongst different factions, may result in another refugee wave to Turkey. Concurrently, a more political role by the latter in the reconstruction of Syria could benefit Turkish businesses.
The permanent loss of its land bridge in Syria may challenge a resurrection of Hezbollah and could benefit Lebanon in two ways. The ceasefire between Israel and Hezbollah “is more likely to last.” Second, Lebanon may have a chance to get out of a domestic political impasse because of the Hezbollah influence.