From reactive to resilient – how to manage geopolitical risks

Rising Global Tensions

Geopolitical risks have intensified sharply in early 2026, driven by flashpoints in the Middle East, Europe, and Asia. The US ousted Venezuelan leader Nicolás Maduro on January 3, marking a bold intervention that stabilized regional oil flows but heightened broader instability. Now, attention shifts to Iran, where protests and sanctions compound regime pressures, raising the specter of export halts amid US demands for nuclear concessions.

These developments compound ongoing conflicts. Russia's invasion of Ukraine, entering its fourth year, shows tentative signs of de-escalation through a possible ceasefire, yet breakdowns remain probable given mutual distrust and NATO's proximity. In the Middle East, the Gaza truce holds precariously, while US-Iran brinkmanship—fueled by Trump's aggressive stance—has deployed unprecedented military assets, including two aircraft carriers.

Economic repercussions are immediate and severe. Oil prices have climbed to $72 per barrel, with forecasts warning of $80-plus if Persian Gulf shipping falters. Supply chains, already strained from US-China tech rivalries, face further fragmentation as both powers prioritize national security over interdependence. AI emerges as a core battleground: Washington pushes global diffusion of its technologies, while Beijing advances self-reliant ecosystems in robotics and EVs.

Non-obvious trade-offs lurk beneath the surface. Polycentric power dynamics dilute traditional alliances, empowering middle players like Gulf states in AI deals but exposing them to cross-pressures. Investor hedges, such as gold surging to $5,035 per ounce, signal market jitters, yet they mask deeper fractures in global monetary systems. Social unrest, from Iranian demonstrations to European election volatility, underscores how geopolitical strains exacerbate domestic divides, risking policy paralysis at critical junctures.