Iran and Israel: Toward Diplomacy or Greater Tensions?
Although it remains unclear how this change will affect the U.S.-Iran conflict, Gulf sources believe Trump is now compelled to seek a “peace agreement” because he cannot opt for an all-out war. Israel, meanwhile, will face greater congressional pressure, as Democrats in Congress closely monitor Israel’s military operations in Iran, Gaza and Lebanon and may scale back their military support for Netanyahu.
Energy Markets: Temporary Calm
Oil markets have been declining for three days as a result of these developments. Investors believe the new Congress will block Trump’s tougher policies and may revive dialogue between Washington and Tehran. However, reduced oil inventories have prevented prices from falling rapidly.
Ukraine: A Shift in Aid Policy
Democrats can now propose new financial and military support for Ukraine. If they secure the backing of some Republicans, they could override Trump’s veto. Although the rapid delivery of advanced weapons such as the “Patriot” to Ukraine is difficult, efforts are expected to block Trump’s plan to lift sanctions on Russian diesel.
Trade and the Economy
Asian countries, particularly China and India, are expected to take a stronger position in trade negotiations with the United States. India believes Trump’s ability to impose steep tariffs has weakened and that he will have to return to Congress for approval of every trade measure.
Technology and Artificial Intelligence
Technology markets are generally concerned. Democrats in Congress are seeking stricter regulation of artificial intelligence data centers, which has led to declines in the share prices of major technology companies and chip manufacturers in Asia.
