It is no exaggeration to say that the reverberations of October 7 have impacted the Middle East region and beyond in ways that no other past Palestinian-Israeli confrontation did in the past two decades. It is almost certain that it will define the manner in which the history of the conflict will be written in this and perhaps future decades. On top of that, it might be a defining moment for our understanding of the meaning of the principles of human rights, international law, and free speech. We can already see some of the current aftershocks impacting not only the domestic Palestinian and Israeli environments, but also the manner in which the international community and global public opinion interacts with the conflict, as well the regional dynamics and balance of power.

It is the regional dynamics that this Policy Brief seeks to address. The unprecedented direct Iran-Israel armed confrontation in April 2024 represents the highest level of risk-taking that the Gaza war might have generated in the two countries since the eruption of the conflict between the two counties. Despite the apparent calm in the open conflict between Iran and Israel, the developments of the war in Gaza and on the Lebanese front between Israel and Hezbollah might increase the prospects of a return to a similar escalation that may continue to rise, threatening to destabilize the entire region, and might threaten a large-scale regional war. The prospects for such expansion and the potential repercussions on the future of the Palestinian-Authority (PA) and Palestinian-Israeli conflict is the subject of this Brief. Some of the questions addressed in the Brief include the following: did the Iran-Israel rules of the game change? If so, how will this impact the Arab-Israeli and Palestinian-Israeli dynamics, the normalization process, the peace process, security and civil coordination, the future of the PA and Palestinian access to basic needs and utilities, and how should the PA respond to this development.

Background:

The attack carried out by Hamas on October 7 is unprecedented in the entire bilateral Palestinian-Jewish and Palestinian-Israeli conflict of the past 120 years. It is unique in many ways. The attack demonstrated the ability of an armed Palestinian group to execute a large scale and lethal military maneuver on fortified Israeli military bases; to easily occupy, at least for a day, all Israeli towns adjacent to the entire border with the Gaza Strip; and to take about 250 soldiers and civilian hostages and war prisoners while killing 1200 Israeli soldiers and civilians. It goes without saying, that the magnitude of civilian death and destruction is unprecedented, with hundreds of Israelis and tens of thousands of Palestinian civilians killed and close to 70% of Gazan homes, factories, farms, public buildings and civilian infrastructure destroyed. The scale and magnitude of atrocities that have been committed in violation of international law have never been seen before.

The domestic, regional and interactional ramifications for Palestinians and Israelis are also unprecedented. Domestically, the Palestinian Authority has lost almost all support and credibility in the eyes of its own public.[1] Public support for the resumption of PA control over the Gaza Strip after the war does not exceed 11% while 59% support a return to Hamas’ control.[2] In other words, if the choice is between the PA and Hamas, the majority of the public, including a large number of people opposed to Hamas, would prefer it over the PA. In Israel, the political future of the longest serving prime minister, the one most responsible for the deadlock in the Palestinian-Israeli peace process, is threatened, if not completely ruined. Resignation of senior Israeli army officials, while the war is ongoing, is an indication of a deep rift within the Israeli political and security establishments and a great Israeli public eagerness for accountability.

While the Palestinian and Israeli publics continue to show significant distrust, reaching high levels of dehumanization, the findings from the Gaza Strip are extremely helpful in illustrating the dynamics of conflict resolution. While West Bankers and Israeli Jews express strong opposition to the two-state solution, standing, at least, at a two-third majority,[3] PSR’s March 2024 findings show that Gazan support for that solution has increased from 35% to 62% in six months, a dramatic 27-point increase.[4]   When faced with a real existential threat of expulsion or genocide, Gazans turned to the two-state solution as a savior. Nothing shows the vitality and the contribution of that solution to the Palestinian-Israeli conflict better than this finding from the Gaza Strip.

Regionally, the Iranian role and influence have expanded significantly and the threat of a regional war has become real more than any time before, at least since the end of the US 2003 invasion of Iraq. Actors loyal to Iran, in three Arab countries, Yemen, Iraq, and Lebanon, are taking part in the armed conflict with Israel in solidarity with Hamas and the Palestinians. Yemen has blocked normal shipping access in the Red Sea and in doing so brought about direct military intervention by the US and UK against targets inside that Arab country.

The Palestinian issue is now seen as central to regional stability and the search for a solution to the Palestinian-Israeli conflict has become more pressing than it has been since 2014.  The international community embrace of the two-state solution is perhaps more meaningful today than in the past.  The US has presented the relevant parties with its own vision for ending the entire Palestinian-Israeli conflict that combines plans for an end to the war, a “revitalization” of the PA, and a design for the day after the war in a context of a two-state solution and an Arab-Israeli normalization of relations with Israel.[5] Countries in Europe, such as Spain, Irland, and others are discussing possible recognition of the Palestinian state. The International Court of Justice finds it appropriate and urgent to examine charges that Israel is committing genocide against the Palestinians in the Gaza Strip. The ICC is considering issuing arrest warrants against Israeli leaders and military commanders.[6] The United States and the EU are imposing sanctions on violent settlers and entities that support them financially. Moreover, international public opinion is shifting against Israel in a decisive manner. Public opinion polls show Israel losing support, particularly among the youth, in almost all counties of the world, including in the US, Germany, and the UK, with significant domestic implications in many of these countries.[7] The most recent manifestation of this development can be seen in American universities where students are testing the meaning and limits of free speech in American colleges and in the entire country. 

Changing the rules of the game: direct Israel-Iran armed conflict

One of the latest, but potentially the most consequential, reverberations that has impacted the region has been the expansion of the Gaza war to directly include Iran. The Israeli bombing of the Iranian consulate building and the killing of a top Iranian military commander on April 1 might have triggered a new phase in an expanded regional conflict. In one blow, perhaps inadvertently, Israel helped transform the Iran-Israel confrontation from one fought by proxies to direct state-to-state conflict. Nothing demonstrates better the severity of this development than the specter of hundreds of Iranian drones and cruise and ballistic missiles crossing Iran, Iraq, and Jordan on their way to targets inside Israel on April 13. While the vast majority were successfully intercepted by the US and Israel, with help from one or more Arab countries, the Iranian message to Israel, the US, and many Gulf and Arab countries was heard loud and clear. The potential threat to more vulnerable American bases and the Arab countries that hosts them, being much more adjacent to Iran, is much more lethal than the threat to Israel. The success of the US administration and its allies in intercepting the Iranian attack, and in containing Israeli response to that attack, was critical in preventing this episode from escalating into a larger and more devastating armed conflict. Nonetheless, this incidence does raise many questions about the Israeli and Iranian calculus and the potential for miscalculation.

Why did the regional escalation happen in the first place?  Why did Israel attack the Iranian consulate in Damascus thereby escalating the low-level warfare it has been waging against Iran. In other words, why did Israel change the rules of the game? Netanyahu might have an interest in diverting the attention away from the atrocities committed in the Gaza Strip. Bringing Iran into the picture also provides a way to deflect attention away from the humanitarian catastrophe that was unfolding because Israel was restricting humanitarian service delivery, using starvation as a tool of war, particularly in the aftermath of the killing of 7 staff members of the World Central Kitchen who were delivering humanitarian aid to people in northern Gaza.

However, the reports that the attack was a serious miscalculation by the Israeli Military Intelligence, rather than a deliberate provocation by Israeli leaders, should also be taken seriously.[8] In this analysis, the Israeli intelligence did not anticipate the Iranian response and assumed that Iran will continue its previous policy of indirect retaliation. Had it been known that Iran would act differently, Israel would not have attacked. After six months of war, Israel has not yet managed to defeat Hamas or prevent it from governing the Gaza Strip. It has not secured the release of all Israeli hostages and prisoners of war. It has not succeeded in restoring deterrence with Hezbollah or preventing it from attacking northern Israel. The threat to Red Sea shipping has not yet been contained. The West Bank has been boiling, indeed threatening to explode at any moment. In other words, given all that, Israel probably had no reason to seek further escalation by provoking a direct Iranian attack.

Regardless of the Israeli motivation, the question about the Iranian behavior on April 13 is even more important. Why did Iran respond by direct retaliation this time when it did not in the past? After more than a decade of Israeli attacks against Iran in Syria and some inside Iran itself, a traditionally cautious and calculating Iran acted in an unprecedented manner, even historic, by directly attacking Israel from its own territories rather than by using its own proxies. One might argue that as Israel changed the rules of the game, and so did Iran. The Israeli April 1 attack, in this analysis, served as a tipping point. The problem with this analysis is that it ignores the fact that Israel attacked Iran, directly on its own territories, many times in the past by assassinating its nuclear scientists and military commanders and stealing documents related to its nuclear program.

A more likely explanation links the change in the Iranian behavior to dynamics unleashed by the Gaza war. October the 7^th might have empowered Iran, just as it empowered its allies in Lebanon, Yemen and Iraq. If the Israeli army is unable to defeat its weakest enemy, Hamas, in six months, why would Israel possess the will to enter a direct war with Iran or risk opening yet another front, this time with the strongest of all adversaries. One might add that Iran, perhaps wishing to maintain its standing among its own allies and in the region, found it difficult to stay out when its proxies are all engaged in the fight with its full encouragement and support.

Nonetheless, it should be pointed out that the Iranian retaliation, while apparently massive, was in fact greatly constrained and calculated, indicating its wish to avoid further escalation. Israel and its allies had plenty of time to prepare and intercept incoming drones and missiles that needed to travel more than 1000 kilometer. Perhaps the Iranian message was not just for the Israelis, but also for the US and its Arab allies: geographic proximity leaves the American bases and other targets close to Iran much more vulnerable to these Iranian military assets. For Israel, the Iranian message is perhaps one of political resolve rather than military capacity. Hours before the Israeli response to its direct attack, Iran spelled out what seemed like a new policy: “In case the Israeli regime embarks on adventurism again and takes action against the interests of Iran, the next response from us will be immediate and at a maximum level.”[9] Iran, it seems, wants to tell Israel that the rules of the game have changed in yet another way: any future attacks against Iranian assets, regardless of the location, will be met by a direct Iranian retaliation.

On April 19, Israel did retaliate by carrying out a single limited strike near the city of Isfahan, deep inside Iranian territory. The limited nature of the Israeli response, while strongly encouraged by the US, does reflect an Israeli understanding of the Iranian message. But unlike Iran, Israel did not need to send a message of political resolve; it has already attacked on Iranian soil in the past. Rather, Israel wanted to send a message of military capacity; that it can penetrate and attack targets deep inside Iran without Iran’s ability to intercept them; simply put, Iran cannot win. Israel perhaps hopes Iran will get the message and will not seek to retaliate, in a similar manner to that of April 13, in the future. In this regard, Israel perhaps wants to signal to Iran its intention to continue its shadow war when necessary and that the Iranian direct attack does not deter it from doing so. The muted Iranian response to this Israel retaliatory attack near Isfahan, one in which Iran did not point the finger at Israel, might encourage Israel to think that the rules of the game are now restored to their status quo ante. Nonetheless, it is worth noting that Israel has refrained, since April 1, from further targeting Iranian assets in the region.

Implications for the PA and the Palestinian-Israeli conflict

It is in this exchange of messages that the greatest immediate risks to the region lies. If Iran has indeed embarked on a new policy (of direct retaliation) while Israel thinks the rules have not changed (war by proxies), the threat of escalatory dynamics remains in place, just as it was in the immediate aftermath of the Israeli attack on the Iranian consulate building in Damascus. Will Israel now stop or continue its attacks on Iranian targets in Syria and elsewhere? Would Iran retaliate directly against Israel if Israel does make such attacks? The answers to these questions are currently unknown. Because of that, the prospect for a dramatic escalation cannot be ruled out, particularly given the uncertainty about the future of the war in the Gaza Strip and its “day after” and the current limited military exchange between Israel and Hezbollah; regional war must not therefore be ruled out. If so, what are the implications for the Palestinians in their conflict with Israel?

One can think of three possible scenarios for a regional armed escalation. A low-level direct Iranian-Israeli armed confrontation restricted to exchange of missiles without escalation to a full-blown war is a first scenario. The US and Arab allies might restrict their role to one similar to what they did in April. The behavior of Iran and Israel in April, influenced greatly by US pressure, shows that the two states are unlikely to deliberately seek escalation.

In this scenario, the impact on the PA and the Palestinian-Israeli conflict might be small. The PA is likely to stay on the sideline but the Israeli-Palestinian relations are likely to continue to deteriorate. Arab-Israeli efforts to normalize relations might be postponed but regional US-sponsored security coordination is likely to increase. The Palestinian-Israeli peace process might appear to gain some momentum behind the scenes in order to justify Arab cooperation with the US and Israel. Palestinian civil and security coordination is not likely to be affected and Palestinian access to basic needs, utilities, and other necessities is not likely be interrupted. But Palestinian public dissatisfaction and perhaps anger at the PA is likely to increase. Nonetheless, the PA will most likely be able to manage its growing domestic challenges without provoking a violent Palestinian public reaction.

In a second scenario, a more comprehensive armed confrontation is likely to involve attacks on a wide range of military and infrastructural targets and might cause great civilian deaths. Israel’s ability to inflict huge damage on Iran and the inability of Iran’s retaliatory attacks to inflict large scale damage on Israel, due to US and allies’ interception of Iranian drones and missiles, might lead Iran to expand the theatre of war to include US bases and Arab military targets and well as oil and gas fields and related infrastructure. This could immediately change the US posture from defense to offence. Iran might respond by encouraging domestic allies in the Arab countries to join the war in the hope of destabilizing the Arab regimes in the entire Gulf area as well as Jordan. Public opinion in some of these countries might turn against their own rulers and contribute to greater destabilization.

In this second scenario, Arab normalization with Israel is likely to stop. Similarly, no attention is likely to be paid to the Palestinian-Israeli peace process. Security and civil coordination between the PA and Israel is likely to be constrained but unlikely to stop completely. Palestinian access to basic needs and utilities will probably witness major disruptions but unlikely to stop completely. The domestic Palestinian scene is likely to see significant economic, political and security destabilization leading to further weakening of the PA, the expansion of the current armed groups into new areas, and greater armed confrontations between these armed groups and the Israeli settlers and army. Occasional unplanned confrontations between the Palestinian security services and local armed groups might increase. The ability to the PA leadership to survive under these dramatic developments is uncertain. Yet even in this scenario, the likelihood of the eruption of a third Palestinian intifada is not very high as long as the PA security services remain intact. Nonetheless, the West Bank will continue to boil, settlers’ violence is likely to expand significantly, Hamas will continue its efforts to reestablish its armed wing, and in the Gaza Strip, it will find it easier to rebuild its armed wing and reestablish its governing administration.

In a third scenario, a worst-case scenario, Iranian forces might infiltrate into neighboring countries, like Bahrain and Saudi Arabia, to support Shi’ite groups (against a likely crackdown by their governments) and might encourage local armed groups to infiltrate into Jordan, who might be perceived as an ally of the US and Israel. Armed groups from Lebanon, Syria, and Iraq might seek to infiltrate into Israel and Jordan in the hope of bringing a ground offensive dimension to the conflict and bring the fight directly to the West Bank and Israeli territories. In this case, Israeli ground forces will most likely invade Lebanese and Syrian territories and might attack targets in Jordan and Iraq. The US will most likely find itself fighting alongside Israel in both offensive and defensive capacities.

In this third scenario, the expansion of the regional war is likely to end Arab normalization with Israel and all talk of Palestinian-Israeli peace. Security and civil coordination is likely to cease and Palestinian access to basic needs, utilities, and other necessities normally supplied by Israel will probably be almost completely cut off. The expansion of the war in this scenario will also most likely bring about a certain collapse of the PA and the departure of the current leadership of Abbas and the ruling elite, who are currently rejected by the overwhelming majority of the Palestinian public.  A third intifada is likely to erupt as members of the PA security services might join the armed groups. Fatah might revive its own armed group, al Aqsa Brigade, while Hamas might finally succeed in rebuilding its armed wing in the West Bank. Taking advantage of the thin presence of the Israeli army in the Gaza Strip, Hamas might rebuild its armed forces in that area thereby weakening the ability of the Israeli army to fight effectively on multiple fronts. 

Confronting its vulnerabilities? Three steps the PA must immediately take:

Despite the numerous after-shocks triggered by the Gaza war, the PA remained relatively unmoved, essentially sitting on the sideline, awaiting the outcome of that war. This paralysis testifies to the extent of PA irrelevance and lack of leadership and initiative at a time when the Palestinians are faced with the most serious existential threat since 1967. This state of affairs adds to the challenges the Palestinians face as they confront the challenge of the “day after” and the potential of a regional war.

The PA operates today under three tremendous vulnerabilities that reduce its capacity to cope with the current and likely future challenges: the lack of legitimacy, disunity, and incompetence. To meet current and “day after” challenges and to be in a position to mitigate some of the consequences of a regional war, the PA must immediately confront these vulnerabilities and address them.

Holding national elections as soon as possible: Perhaps the most damaging vulnerability lies in its lack of legitimacy in the eyes of the vast majority of its public and the lack of credibility of its leadership not only among Palestinians but also among many, if not all, others. This lack of legitimacy is the direct outcome of the lack of periodic national elections. Lack of legitimacy affects the standing of the various political forces in the Palestinian political life. If the choice is between Hamas and the PA, the public does not hesitate to prefer Hamas over Fatah and the PA for the future control over the Gaza Strip. Asked in March 2024 about the group most deserving of representing and leading the Palestinian people, Fatah under the leadership of Abbas or Hamas, about half of the public selected Hamas and only 17% selected Fatah. Only by putting itself immediately on the road to parliamentary and presidential elections can the PA manage to survive the current and impending challenges.  At the moment, only the ongoing war represents a valid impediment to postpone the elections. The PA should therefore plan to hold elections in 6 to 12 months from today. It should do so without reservations or preconditions. Alternatively, if it finds it cannot hold such elections, the PA leadership should immediately step down. Without elections, the PA has no future and history will deal very harshly with its current leadership and ruling elite.

Reunification of the West Bank and the Gaza Strip requires domestic reconciliation: Palestinian division is the second PA vulnerability. Its failure to reconcile with Hamas and reunify the West Bank and the Gaza Strip during the past 17 years intensified Palestinian political polarization and has now come back to haunt us at a moment of great Palestinian peril. The reunification process must proceed now without hesitation. It must not wait for the end of the war in the Gaza Strip. It should be plainly clear to the PA leadership that Israel will treat it with utmost contempt and rejection regardless of whether it reconciles or does not reconcile with Hamas. But reunification will not be possible without the formation of a transitional government, one that meets public expectations.  In March 2024, the public demanded the formation of such transitional government but insisted on imposing three conditions on it: (1) it must be made up of competent professionals, (2) representing national unity or consensus, and (3) it must be independent of political parties or president Abbas. The current PA government does not meet most of these conditions. The current government lacks legitimacy and public acceptance. It cannot be expected to deal successfully with any of the major challenges facing Palestinians today, those that it will face in the “day after,” or manage the consequences of a regional war.

Addressing PA incompetence: The PA’s failure to meet the basic needs of the public in delivering good or competent governance, fight corruption, build strong and accountable public institutions, ensure financial stability, or build an independent capacity to deliver water, electricity, and fuel after 30 years of its existence, testifies to its utter incompetence in ensuring the wellbeing of the Palestinian people. While the continued Israeli occupation and the interests of some of the donor counties have certainly played a role in this dismal outcome, the fact that the PA did not prioritize these national goals in its negotiations and interactions with Israel and the international community testifies to its own failure in prioritizing the national interest. A transitional government made up of the best and brightest minds. from Palestinians residing in the occupied Palestinian territories and Palestinians from the diaspora, representing the national consensus, working closely with the PLO, must outline a workplan and a timetable to restore the constitutional functioning of the political system and remove from the PA legal system all those presidential decrees and administrative decisions that have over the past decade corrupted the entire political system and destroyed its accountability and oversight. The plan must demonstrate convincing commitment to combating corruption and strengthening of the independence of the anti-corruption institutions. It must gradually reduce dependence on Israel for transfer of clearance funds and basic needs and utilities and ensure greater Palestinian self-reliance.

It is prudent, and certainly imperative, for the PA to take measures today rather than wait for the “day after” or the onset of regional war. Immediate steps are required in order to help alleviate some of the great difficulties that the Palestinian population will definitely face once the “day after” arrives or if the Gaza war escalates to a regional one. It goes without saying that once the “day after” arrives, facts on the ground in the Gaza Strip will dictate the future and the PA will continue to be irrelevant. Hamas will resume control over that Palestinian territories and Palestinian division will become more consolidated. Furthermore, if the third scenario of the regional war, as described above, begins to unfold, the PA’s ability to prevent its own collapse, no matter what it does, if it has not already taken strong measures, will be negligeable. Even under the second scenario, the ability of the PA to act, will be significantly constrained. Only today, and under conditions of the first scenario, can the PA take measures to ensure its ability to continue to provide services to the public under conditions similar to those entailed in the second scenario.