The Middle East has undergone a profound power shift since the October 7 attacks, with three years of war weakening Iran’s regional alliance network, eroding confidence in the United States and leaving Israel militarily stronger but increasingly isolated.
Conflict, economic disruption and a breakdown in the region’s previous balance of power have reshaped relationships across the Middle East. Iran’s network of allies has been severely damaged, although Yemen’s Houthi rebels remain a notable exception.
Israel has killed senior figures in Hezbollah and Hamas, while Iran’s Supreme Leader, Ayatollah Ali Khamenei, was assassinated in February. Israeli forces now occupy most of Gaza, where more than 74,000 Palestinians have been killed and much of the territory reduced to rubble, according to the figures in the source material.
Those gains have come at a diplomatic cost. Israel’s military campaign has alienated traditional allies, contributed to its declining popularity in the United States and made further normalisation agreements with Arab countries appear unlikely in the short term.
Israel has also continued launching attacks across the region, crossing previously established red lines, including with its 2025 strike on Doha, Qatar. The result, the source material says, is that many governments increasingly regard Israel as the principal source of unrest in the Middle East.
US security umbrella loses its appeal
Before October 7, Washington’s regional policy was built around normalising Israel’s position through the Abraham Accords, according to HA Hellyer of the Royal United Services Institute. “Israel’s response to the October 7 attack ended that,” he said.
Rather than producing a more stable region centred on Israel, the United States entered a war with Iran this year and subsequently watched Tehran target American allies in the Gulf. The attacks have undermined the perception that the US security umbrella can guarantee regional protection.
Drones and missiles struck Qatar’s Ras Laffan gas hub, while fires were reported near Dubai airport and in Fujairah’s oil zone. In September, the Houthis advanced along Yemen’s Red Sea coast, capturing the port of Mocha and nearby islands and tightening their control of the Bab al-Mandeb strait.
The waterway is a key route for global trade and energy supplies, made more important by disruption in the Strait of Hormuz. “There’s been a loss of faith in the US as a singularly sufficient security guarantor,” Mr Hellyer said.
Regional governments have consequently been looking to other powers while maintaining, and in some cases deepening, their ties with Washington. In August, Saudi Arabia, Turkey and Pakistan signed the Mecca security pact, under which an attack on one member is to be treated as an attack on all.
Iran’s alliances weakened as rivalries shift
The weakening of Hezbollah, whose reputation had long acted as a deterrent against Israeli attack, helped create the conditions for a wider Israeli military push. Israeli troops invaded Lebanon in October 2024 and again in March 2026, while Israel seized Syrian territory during the power vacuum that followed Bashar al-Assad’s ousting in 2024.
Sanam Vakil, director of the Middle East and North Africa Programme at Chatham House, said the region had become even more dependent on several competing external relationships. Turkey has increased its leverage in Syria, while China has taken part in negotiations over ending the war on Iran as its own energy supplies face threat.
“It’s ironic, since October 7, it’s Israel that has emerged as the revisionist power and Iran almost as the status quo power,” Ms Vakil said. Tehran, she added, appeared more focused on recovering ground lost over the past three years than on expanding beyond it.
She cautioned against interpreting Israel’s military dominance as evidence that it had become a regional superpower. “Israel may currently be the preponderant military power in the Middle East, but real power is typically classed as being able to project stability, which Israel hasn’t shown itself able or willing to do,” she said.
Strait of Hormuz puts pressure on the region
Attempts by Israel and the US to bring down Iran’s government through February’s attacks instead opened another front. Tehran now has economic leverage over Israel, the US and their partners through the Strait of Hormuz, which borders Iran and normally carries about a fifth of the world’s oil and gas, as well as through the Bab al-Mandeb, where its Houthi allies threaten shipping.
The economic consequences have not been evenly distributed. Western countries have been cushioned by emergency reserves, record US oil production and supplies from countries including Norway, avoiding a repeat of the petrol shortages seen during the oil shocks of the 1970s.
The International Monetary Fund cut its 2026 global growth forecast in April only slightly, from 3.3 per cent to 3.1 per cent. Gulf exporters have suffered more sharply: Saudi Arabia’s forecast was reduced from 4.5 per cent to 3.1 per cent, while Qatar’s projected 6.1 per cent growth was replaced by an expected contraction of 8.6 per cent.
Shir Hever, an Israeli political economist, said the West’s reduced dependence on Gulf oil had paradoxically made Israel more of a liability to the United States. Some in Israel believe the current crises could drive Gulf states towards an alliance with Israel, he said, but added that such an outcome appeared unlikely.
