An Israeli power network worker was killed, and 13 other civilians were injured by an anti‑tank missile fired by fighters from Hizbullah, an Iranian-sponsored Lebanese Shia group, on November 12th as the group continues attacks on Israel in support of Hamas, a Palestinian Islamist group. We still expect the conflict to be broadly contained to Gaza, but the risk of escalation on the Lebanese border is rising.

Why does it matter?

Hizbullah has begun to hit targets deeper inside Israel and deployed new weapons. Together with other groups believed to operate with Hizbullah’s approval from Lebanon, about 150 attacks have been launched on Israeli targets since the war in Gaza began on October 7th. There have been other attacks from Iranian-supported groups in the “axis of resistance”, including five attacks launched from Syria, including a drone attack on November 10th that reached Israel’s far south. On November 15th Israel reported that its anti‑missile Arrow system had intercepted another attack from Iranian-backed Houthi rebels in Yemen.

Israel has responded to Hizbullah attacks with retaliatory strikes deeper into Lebanon. However, we assess that neither Israel nor Hizbullah (or its Iranian patron) are seeking to escalate into a full‑fledged war. Israeli military and economic resources would be strained by a two‑front war, especially as Hizbullah has far more fighters and missiles than Hamas. For now, Israel is retaliating against Hizbullah attacks but not initiating operations. Meanwhile, Hizbullah and Iran appear to prefer continuing to harass Israel rather than risk the probable devastation to Lebanon from a full‑scale war, given the probable damage to Hizbullah’s military capacity and to the group’s position as Lebanon’s dominant political power in the event of war.

Despite the caution, as the fighting in Gaza intensifying, the risk of a conflagration remains large.An added complication is the growing friction between Iranian-aligned militias and US forces stationed in Iraq and Syria.& These militias have staged more than 45 attacks on US positions, injuring dozens and prompting at least three US retaliatory attacks, increasing the risk of a broader regional conflict.

What next?

Hizbullah has been expanding its presence in southern Lebanon for years while the Israeli-Lebanese border has been mostly calm. However, Israel’s policy of tolerating a militant group on its borders, on the assumption that Hizbullah could be deterred by threats and small‑scale operations, has been seriously dented by Hamas’s assault on Israel in October. Destroying Hizbullah capabilities, as Israel plans to do with Hamas, would incur a far heavier cost, but Israel might calculate that this is necessary. However, were Israel to do so, this would probably occur after the Gaza campaign ends, unless triggered by an unplanned escalation during the current stand‑off.

The analysis and forecasts featured in this piece can be found in EIU’s Country Analysis service. This integrated solution provides unmatched global insights covering the political and economic outlook for nearly 200 countries, enabling organisations to identify prospective opportunities and potential risks.