The Weekly Forecast Monitor is a forward-looking assessment of geopolitical dynamics shaping our world. To get more in-depth analysis of these issues and learn more about analytical products from New Lines Institute — including simulations, training sessions, and forecast reports — contact us at [email protected] and visit https://newlinesinstitute.org/analytical-products/. Download PDF Version.
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Global Hotspots
The Global Hotspot Tracker examines the outlook for key geopolitical hotspots around the world. (Go to the Global Connectivity Tracker)
Russia/Ukraine Conflict
Summary – The Russia-Ukraine conflict trended toward military and hybrid escalation scenarios as Ukraine launched a major incursion into the Russian border region of Kursk. Russia reportedly delivered advanced air defense systems to Iran. Ukrainian President Volodymyr Zelenskyy said his country was preparing for an end to the war with Russia by the end of this year.
Military escalation scenario
- Ukrainian military forces launched an incursion into the Russian border region of Kursk and engaged in an ongoing battle with Russian forces. Russian President Vladimir Putin called the operation a “major provocation,” while local authorities evacuated residents from the region following civilian and military casualties.
Risk level – medium - Russian Security Council Secretary Sergei Shoigu visited Iran, and Iranian officials announced that Russia began delivering advanced air defense systems to Iran.
Risk level – medium
Hybrid escalation scenario
- Mali and Niger have cut diplomatic relations with Ukraine following an attack by Malian rebels against Russian mercenaries and Malian soldiers for which Mali accused Ukraine of providing intelligence.
Risk level – medium - The EU added 28 Belarusian individuals to its sanctions list due to “ongoing internal repression and human rights violations.”
Risk level – low
Diplomatic de-escalation scenario
- Zelenskyy said in a post on X (formerly Twitter) that Ukraine is preparing for an end to the conflict with Russia by the end of this year.
Opportunity level – medium - Shoigu said another peace conference makes no sense until Zelenskyy responds to the peace proposals put forward by Putin in July.
Risk level – low
Middle East
Summary – Tensions in the Middle East trended toward military escalation as the region braces for retaliatory attacks from Iran and Hezbollah after the killing of Hamas and Hezbollah leaders last week. Days of diplomatic visits from regional and global powers have temporarily halted immediate Iranian plans to attack Israel, but Iran maintains that it will respond “appropriately.” The U.S. attacked Houthi assets, including drones and aircraft, before attacking Houthi-held Ta’izz province. Hamas appointed Yahya Sinwar, mastermind of the Oct. 7 attacks, as its new leader.
Military escalation scenario
- Iran has stated it they will retaliate for the killing of Ismail Haniyeh at the “right time” after diplomats urged caution.
Risk level – medium - U.S. Deputy National Security Advisor Jonathan Finer said U.S. military assets are being moved to the Middle East to de-escalate the conflict.
Risk level – medium - Countries are warning their citizens to leave Lebanon as soon as possible amid growing fears of a regional war. Many airlines have stopped flying to Beirut.
Risk level – medium - Israeli airstrikes in the West Bank killed five people, including a Hamas commander. Israel also targeted two schools in Gaza with airstrikes, killing dozens of people, including those who were sheltering at the school after being displaced.
Risk level – low/medium - Hezbollah rocket fire struck Beit Hillel in Israel, causing fires. Israel denied the group’s claim that the attack injured civilians.
Risk level – low/medium
Hybrid escalation scenario
- U.S. officials said Russia has deployed military intelligence officers to Yemen to assist Iranian-backed al-Houthi militants with their efforts to target commercial vessels in the Red Sea.
Risk level – medium
Diplomatic de-escalation scenario
- The U.S., Egypt, and Qatar urged Israel and Hamas to meet on Aug. 15 to finalize cease-fire negotiations. Israeli Prime Minister Benjamin Netanyahu has agreed to attend the meeting, but Hamas has not yet commented.
Opportunity level – medium - In a visit to Tehran, the secretary of Russia’s security council Shoigu told Khamenei not to attack Israeli civilians and exercise restraint when retaliating for the killing of Haniyeh.
Opportunity level – low/medium
U.S./China/Indo-Pacific
Summary – Tensions in the Indo-Pacific trended toward a military escalation scenario, as Taiwan held more live-fire artillery drills and announced an increase in defense spending. The U.S. held joint naval and air force military exercises with the Philippines, Australia, and Canada in the South China Sea, while China conducted its own military drills around the Scarborough Shoal. Tensions between the Philippines and China continued to escalate despite diplomatic overtures two weeks ago, while Vietnam attempted to defuse its own tensions with China.
Military escalation scenario
- The Philippines, Canada, United States, and Australia held a joint military exercise in the South China Sea involving naval and air force units.
Risk level – medium - The Chinese navy and air force held joint patrols around Scarborough Shoal.
Risk level – medium - Taiwan’s Third and Fifth Theatre of Operations held live-fire artillery drills in northern and central Taiwan, two weeks after holding its annual Han Kuang military exercises.
Risk level – medium - Taiwan announced it would increase its 2025 defense budget by 6% to $19.8 billion, in addition to pledging to modernize the military through better implementation of decentralized command.
Risk level – medium - China is building what is reported to be the world’s largest amphibious assault ship, expected to be launched by early 2025.
Risk level – low/medium
Hybrid escalation scenario
- A U.S. court in Brooklyn found a Chinese-born academic, Wang Shujun, guilty of illegally acting as a foreign agent in the U.S. by collecting information about pro-democracy activists in New York and sharing it with Beijing.
Risk level – low - China has announced the discovery of a new major gas field in the South China Sea. Called Lingshui 36-1, it is estimated to hold 100 billion cubic meters of gas.
Risk level – low/medium
Diplomatic de-escalation scenario
- Beijing is tightening controls on precursor chemicals used in fentanyl production, marking closer bilateral cooperation with the U.S. in line with their November 2023 agreement on restricting fentanyl production.
Opportunity level – medium - The Vietnamese navy sent a frigate to the Southern Chinese naval port of Zhanjiang in an effort to reduce tensions in the South China Sea.
Opportunity level – low/medium
Global Connectivity
The Global Connectivity Tracker examines the sectoral impact of geopolitical dynamics on key themes like the global energy/climate transition, trade, and technology. (Go to the Global Hotspot Tracker)
- United States: Wave Energy
What happened: A grid-scale wave generation device, billed as the world’s first, has been installed at a U.S. Navy test site off the coast of Hawaii.
Significance/Outlook: The 826-ton buoy-style generator, which was developed by Ocean Energy USA, has a production capacity of 1.25 megawatts. Surging waves push a column of trapped air in the device through a turbine, which in turn creates electricity. The $12 million project is jointly funded by the U.S. Department of Energy and Ireland’s Sustainable Energy Authority. Meanwhile, legislation that would direct $1 billion into ocean-generation research has been filed in the U.S. House. The bill, dubbed the Marine Energy Technologies Acceleration Act, would provide funding to pay for demonstration projects, research and development, and more efficient permitting of ocean hydropower technologies.
Opportunity level – low/medium - Serbia/European Union: Lithium
What happened: Environmental protesters are strongly opposing the reopening of an EU-backed Serbian lithium mining project.
Significance/Outlook: The Serbian “Jadar” lithium mining project was put on hold in 2022 by the national government amid strong public opposition. Since then, a constitutional court deemed the move to be unlawful, and President Aleksandar Vučić signed a decree in July allowing the project to be reopened. However, protesters in Serbia backed by opposition political parties are opposing the perceived environmental costs of the project despite the EU’s assurances of strong environmental standards. Serbia’s Jadar valley is one of the most lithium-rich areas in Europe, and the mining project would greatly aid the EU’s plans to reduce its dependence on imports of critical raw materials used in the production of electric vehicles. The protests are expected to continue throughout August.
Risk level – low/medium - Türkiye/Turkmenistan: Natural Gas
What happened: Türkiye and Turkmenistan have agreed to engage in a gas trade of 15 billion cubic meters (bcm) per year for the next 20 years.
Significance/Outlook: The Turkish government is working to import 300 bcm of natural gas from Turkmenistan to Türkiye and Europe in the next 20 years. To reach this goal, Türkiye needs pipeline extension, long-term agreement, and higher gas storage capacity. Turkmenistan has been a marginal natural gas exporter to Europe due to the challenges of building a pipeline across the Caspian Sea, with the country exporting most of its supplies eastward to China. Support for a Trans-Caspian pipeline between Azerbaijan and Turkmenistan in 2023 could strengthen energy linkages with Türkiye and Europe, but opposition from Russia to such a pipeline has served as an obstacle.
Opportunity level – low/medium - China: Solar
What happened: Chinese solar manufacturers are facing bankruptcy due to oversupply of products.
Significance/Outlook: Some small Chinese solar companies faced bankruptcy due to a massive price slump. Larger players, like Longi Green Energy Technology, are suspending production and laying off workers, recording a loss estimated at a minimum of $660 million. Cooperation between Chinese solar companies along and the government is vital to ensure the stability of the market, especially for small manufacturers that seem to be affected the most by the price slump.
Risk level – low - Indonesia/Russia: Nuclear
What happened: Indonesia is planning to build a 10 MW experimental nuclear power reactor near Jakarta based on a conceptual design by Russia.
Significance/Outlook: During his fourth visit to Moscow, Indonesian President-elect Prabowo Subianto expressed interest in strengthening relations with Russia in the fields of energy, transportation, and infrastructure. As Indonesia currently has no nuclear power plants, Subianto’s agenda includes developing this sector further, focusing on both small modular reactors and main reactors. The visit extends beyond energy and holds potential technology cooperation in the defense sector between Russia and Indonesia. With rising security tensions in the region fueled by strategic competition, the defense sector is poised to become a top priority for Subianto. Indonesia’s openness to working with Russia in these sectors shows the country’s eagerness to diversify its relationships in the region.
Opportunity level – low/medium
Key Stats of the Week
- The EU has numerous strategic agreements over critical minerals mining and refining; in 2021 it signed such agreements with Canada and Ukraine; in 2022 with Kazakhstan and Namibia; in 2023 with Argentina, Chile, Zambia, the Democratic Republic of the Congo, and Greenland; and in 2024 with Rwanda, Norway, Uzbekistan and Australia.
- By 2030, the EU will only be able to meet 9% of its demand for cobalt, 16% for nickel, and 58% for lithium from domestic sources.
