In many ways, a year after the shock terror attack on Israel by Hamas, Tel Aviv’s response has shown that the political limits to tolerate military escalation have altered. States in West Asia are not just currently reluctant but possibly averse to getting drawn into a conventional state-to-state military conflict. While solidarity over the Palestinian cause and indiscriminate attacks on Gaza will continue to draw ire, the impulse is, at best, to support proxy groups, not to commit armed forces.
In fact, until the death of Hezbollah leader Sayyed Hassan Nasrallah, Iran, too, had exercised relative restraint. But with Netanyahu focusing on its northern borders, targeting Lebanon and systematically pursuing the Hezbollah leadership, Iran felt compelled to display its intent. Can this now escalate into a direct military conflict with Iran? That’s another test for Netanyahu in his attempt to explore the limits of a redefined escalatory matrix.
The Arab states have stayed studiously away from showing any Sunni-Shia Islamic solidarity. They may even be viewing Israel’s weakening of Hezbollah and Iran’s retaliatory steps as a favourable spectacle in the games that inform the region’s complex power balance. Tehran’s call for a ceasefire in Lebanon and Gaza right after its Oct 1 missile attack on Israel indicates its reluctance to escalate matters with Netanyahu, especially when rival powers like Saudi Arabia are making rapid economic strides staying away from the conflict.
The one common thread is that the internal political and economic dynamic of countries are driving their strategic choices more than external considerations. Saudi Arabia, for instance, is in the middle of a rapid economic transformation. According to IMF, Riyadh added over a million jobs, mostly in the private sector, in 2023.
This has brought down the unemployment rate to 7.7%, in line to meet its 7% target by 2030. The gender mix has improved with women now forming 30% of the workforce. Transformation is being led by high growth rates in non-oil sectors, which augurs well for its economy.Iran, on the other hand, has had to cope with US sanctions, higher unemployment, mounting domestic pressure and its powerful religious leadership, while trying to assert its political profile.Netanyahu also has his own domestic agenda. His approval ratings have improved dramatically from the lows of last year. The campaign in the north against the more formidable Hezbollah has strengthened his image, though serious doubts have been raised on his failure to rescue all hostages from the Oct 7, 2023, Hamas attacks. Comparisons are drawn with his older brother Yonatan ‘Yoni’ Netanyahu, who died in the famous 1976 raid on Entebbe, where Israeli forces successfully rescued all hostages from a hijacked Air France flight.
The turnaround from someone who was trying to reshape West Asia’s political landscape through the Abraham Accords to now providing a model on how states can carve out space to pursue aggressive military options is quite dramatic.
Unlike many of his predecessors who sought to build international legitimacy for pursuing military action through UN outreach, Netanyahu has pressed ahead despite UN. Israel has banned UN secretary general Antonio Guterres from entering the country, declaring him persona non grata.
The other factor has been stable oil prices. While oil prices have risen by about $7 a barrel in the past week, touching $78 a barrel owing to the fresh round of escalation, they are still a distance away from causing any major crisis. Moreover, Opec is producing below par. Countries like Saudi Arabia are holding on to substantial spare capacity, as world consumption is now at around 105 mn barrels a day.
Also, countries like India, the third-largest oil consumer in the world, have diversified their buyers’ basket to include more countries. Russia, for instance, still accounts for roughly 38% of India’s imports. So, there are ways and means to deal with any significant price surge. Interestingly, Saudi Arabia, with its spare capacity, alone can assure sufficient increase if the crisis were to widen and hit oil production.
Finally, the great divide among the five UNSC permanent members has rendered any global intervention ineffective, if not a non-starter. For all the debate, Israel will be in the US camp. Netanyahu has shown he can leverage geopolitical divide among both the P5 and US presidential elections to his advantage.
In all, Netanyahu’s model, while constantly extending and testing the margins of escalation, has left him now with a gambler’s predicament on when to scale back. Matters have reached a point with Iran where a single misstep, a wrong choice of targeting an installation like an oil or refining facility, or any sort of misadventure can trigger a disproportionate response.
Israel knows well that while attrition can destroy terror capabilities, chances of any unconventional terror response remain higher than ever before.