Note: Today is the third in a series of posts that detail Eurasia Group's Top Risks for 2013.

The Middle East will enter a new phase in 2013. Arab Spring will give way to Arab Summer, as the region faces a series of increasingly complicated overlapping conflicts. As Americans and Europeans resist deeper involvement, rivalries among Saudi Arabia, Iran, and Turkey, competition for influence between Sunni and Shia, a lack of economic progress, and a resurgence of militant groups will each heighten tensions.

Syria remains the central arena of conflict, as Shia powers -- Iran and Lebanese Hezbollah -- on the one side, and Sunni states -- Turkey, Saudi Arabia and Qatar -- on the other compete for leverage. Jihadists have also entered the fray, and turmoil has spilled across the country's borders into Lebanon, Turkey, Jordan, and Iraq.

Emerging conflicts elsewhere are less obvious. Egypt, Tunisia, and Morocco now have moderate Islamist governments. In Jordan and Kuwait, Islamist opposition groups threaten the governing dominance of secular administrations. But while the words and actions of mainstream parties like Egypt's Muslim Brotherhood and Tunisia's Ennahda make headlines in the West, the more serious risk comes from militant organizations that threaten the ability of new leaders to govern and maintain security.

Fueling this trend is the reality that, across the region, new leaders are trying to consolidate power and build popularity at a time when complicated economic problems demand solutions that will make large numbers of people angry. New governments in Tunisia, Libya, Egypt, and Yemen will last only if they can deliver tangible economic progress for an increasingly frustrated and impatient public.

The risk that a Salafist or jihadist group can exploit these frustrations to seize power in 2013 is low, but groups like al Qaeda in the Islamic Maghreb, al Qaeda in the Arabian Peninsula, al-Shabab, and smaller affiliates continue to attract support and new followers by using resentments against local regimes to foster anger at America and the West. 

But Iraq may become 2013's newest hotspot. Sunni-Shia tensions are growing, and none of Syria's neighbors is more vulnerable to the threats created inside that country by radical Wahhabi clerics, often with Saudi or Qatari support, now fueling the emergence of an increasingly radicalized and militarily experienced Salafist movement. The Kurdish regional government is becoming more aggressive in promoting its energy development agenda at Baghdad's expense, and Sunni-led violence inside the country might well encourage Iraq's Shia-led government to forge closer ties with Tehran, antagonizing the governments of Saudi Arabia and Turkey.

The Obama administration wants to focus on domestic challenges and an ongoing foreign policy shift toward Asia. But regional rivalries are heating up, and Americans and Europeans will only add to the uncertainty by keeping their distance -- in hopes that they don't get burned. 

On Wednesday, we'll profile Risk #4: Washington Politics.  

By Hani Sabra and Willis Sparks

Thousands of Egyptians are now gathering across their country to chant their denunciations of Egypt's new draft constitution, a document completed by the Islamist-dominated constituent assembly just days ago. Pro-democracy revolutionaries, the young people who sparked the movement that toppled Hosni Mubarak in 2011, warn that the new constitution will give the military enormous power, fail to force the president to appoint a vice president, and the vague language on freedoms of religion and the press, and protections for the rights of women could actually be used to discriminate.

But when the constitution is put to a popular vote less than two weeks from now, it will pass. Why? Because its authors (the Muslim Brotherhood) and their sometime political partners (the military), remain the two most powerful groups in the country. Because the Islamists campaigning for it are organized and popular. And because they will argue, as they did in March 2011 during a debate over temporary constitutional amendments, that it is the duty of Muslims to vote for a document that will provide longed-for stability and that reflects the will of a people that elected the Muslim Brothers to power. (Seventy-seven percent of voters approved the 2011 constitutional amendments.)

There is another reason why the draft constitution will pass. The non-Islamist opposition has not made a clear and compelling case to voters that a "no" vote will make Egypt more stable and prosperous. The protesters warn that this constitution does not reflect the aspirations of those who ousted Mubarak to gain "bread, freedom, and social justice." They're right. But they haven't explained to large numbers of voters why a rejection of this document will improve their lives. The Islamists insist that a vote against the constitution is a vote for uncertainty, instability, and continued conflict.

In short, the protesters offer no clear alternative. There is no constitution B. Faced with a choice between yes and no, most Egyptians will choose the path they believe will move things forward toward a restoration of order-even though a new constitution won't really accomplish that. It's not that the Muslim Brotherhood is unbeatable; when Egyptian voters have a choice, Brotherhood candidates sometimes lose. Their man, Mohamed Morsy, is president, but he only drew a quarter of the vote in the first round of a hotly-contested election, and in the runoff, he barely defeated Ahmad Shafik, Mubarak's right hand man. To win that second round, he needed support from millions of non-Islamist voters who chose him because he represented a viable alternative to continuation of the old regime.

And until the young protesters and the broader non-Islamist camp offer an alternative that voters can understand and accept, they will have more defeats ahead. 

Hani Sabra is an analyst in Eurasia Group's Middle East practice. Willis Sparks is an analyst in the firm's Global Macro practice. 

By Crispin Hawes

There are a growing number of signals from Saudi Arabia that the question of when the younger generation of princes will be included in the formal line of succession has been resolved. On 5 November, Prince Mohammed bin Nayef was appointed to succeed his late father as the minister of interior, a decision that is likely the result of a deal between King Abdullah and different branches of the ruling family. As a result of that appointment, an announcement on who will take the second spot in the succession is likely to come soon.

Mohammed's appointment to head the Ministry of the Interior is the latest move in an extended process aimed at setting out the ruling family's plans for the long-term succession. Prince Mohammed replaces his uncle Prince Ahmed at the ministry after a truncated term. Prince Ahmed was likely moved aside, despite official statements that he had asked to relinquish the post, and that hints at a decision on the succession. Defining the long-term line of succession requires public consensus among senior family figures, and Ahmed's recent public statements suggested that he was pushing to succeed Crown Prince Salman, who is set to take the throne on Abdullah's death. Saudi Arabia's opaque internal politics make interpreting what is happening behind the scenes very difficult, but Ahmed's replacement as interior minister could well have been triggered by his opposition to developments in the line of succession. If Abdullah has decided to appoint Prince Khaled al-Faisal as second deputy prime minister, the position occupied by the second in line, Ahmed's opposition would be enough to force his departure.

Abdullah seems intent on defining a long-term plan for the succession in an effort to prevent the kingdom from instability if, as is possible, there is a rapid series of deaths among the current and elderly ruling generation. The transition to the generation of Mohammed and Khaled al-Faisal, grandsons of Abd al-Aziz Ibn Saud and modern Saudi Arabia's founder, has been the subject of speculation for years. Faisal is in his early 70s, only a few years younger than Salman, but the move is a very significant one.

Mohammed's promotion is likely part of a broader compromise between the king and the dominant Sudairi branch of the family. Again the details are impossible to confirm, but it is likely that the Sudairis have retained the interior ministry in return for agreeing to allow the insertion of the moderate Khaled al-Faisal (and not a Sudairi) in the line of succession. If that is indeed what is happening, there will almost certainly be a number of other deals emerging in coming weeks and months that will set the stage for other members of the next generation, including King Abdullah's son Mitaeb, to move into more prominent positions.

Crispin Hawes is the director of Eurasia Group's Middle East practice

By Hani Sabra

Egypt was rocked on October 12 by yet another violent demonstration in Cairo's iconic Tahrir Square, but this time the two groups fighting were erstwhile comrades who had cooperated to bring down the previous regime. The street fighting between Egypt's young secularist revolutionaries and the Muslim Brotherhood's core supporters marks the opening of a rift between the two groups that had been threatening to emerge ever since the heady days after former president Mubarak was forced from power. It also could set the stage for ongoing tensions and perhaps weakening international support for the Islamist dominated government.

The cause of the fighting was a broadening dispute over Egypt's constitution. It's been nearly two years since former president Hosni Mubarak was ousted but the country is only now likely to get a new constitution in the next few months. The document, when it is finally approved, will probably only satisfy the nation's Islamists who are taking the lead given their slim majority in the constituent assembly that is drafting the new constitution and their majority among the population.

Egypt's Islamists have made it clear that they are completely willing to move ahead with their version of the constitution without buy-in from secularists or the Copts. And even if a court order dissolves the current constituent assembly (as was parliament) President Mohamed Morsy would move quickly to appoint a new assembly that would be of a similar makeup.

When the assembly releases a draft for a public referendum, it will pass. The last yes or no referendum in Egypt was in March 2011 soon after Mubarak was ousted. The Islamists then urged their supporters to support the constitutional amendments and the final tally was 77 percent in favor. The secular argument against a more Islamist-leaning constitution and in favor of one that stresses human rights, press freedom, and some separation between religion and state, does not resonate with a majority of the population, which is eager to end the constitutional vacuum.  

Unfortunately, a new constitution will not settle Egypt's transitional woes. Continued tension, instability, and violence are likely to continue given that the young revolutionaries who sparked the movement to oust Mubarak, most of the establishment secular politicians, and their supporters are increasingly unhappy with Islamist efforts to monopolize politics. These groups represent a minority, but they are vocal and their anger is growing as evidenced by the ugly brawl between Islamists and the secularists.

The revolutionary activists are embittered and believe the Brotherhood has betrayed them. Many of these young secularists backed the Brotherhood for the past year and half and even voted for Morsy in the second round of the presidential election when he faced Mubarak confidant Ahmad Shafik. They also supported Morsy's move to sideline the two most senior Mubarak-era generals. In exchange, the revolutionaries believed the Muslim Brotherhood would honor its promise to ensure that the constitution would be broad-based, and that it be a truly democratic founding document. This will not be the case. In fact, early drafts raise concerns on issues such as women's rights, religious tolerance, and freedom of expression, spurring sharp criticism from local activists and international organization such as Human Rights Watch.

The revolutionaries do not have the public support or the capacity to force adoption of a more liberal constitution or bring down the Morsy government. But they can make the next several months difficult for the Muslim Brotherhood, and they probably will. More clashes like the recent episode in Tahrir Square are likely, and will attract exactly the kind of attention that Morsy's government would prefer to avoid, given that it wants to project an air of stability for foreign investors and governments.

Hani Sabra is an analyst in Eurasia Group’s Middle East practice.

By Aditya Bhattacharji, Daniil Davydoff, and Scott Rosenstein

Attacks on U.S. interests in the Middle East are not the only security threats to have emerged from the region in recent weeks. In epidemiological circles, concern has been mounting over the discovery of a novel coronavirus in Saudi Arabia, just as Muslims from all over the world begin the annual hajj pilgrimage to Mecca at the end of October.

In the coming weeks, much-needed surveillance and scientific analysis will likely yield important details regarding this virus's threat to human health. But healthcare system shortfalls in some of the countries that dispatch the most pilgrims present obstacles to disease monitoring. And regardless of the microbe's eventual health, economic, and political impact, these deficits are a vivid reminder of institutional challenges to global disease prevention and control.

Little is known about the novel pathogen, but it does belong to the same family as the virus behind the 2003 SARS outbreak, a previously unknown microbe that killed nearly 800 people and sickened more than 8,000. SARS revealed the political and economic  risks attendant to emerging infectious diseases. But attention to these dangers has increased considerably since SARS, and this novel virus has thus far been confirmed in only two patients, one of whom is under intensive care at a hospital in London.

Whether it's a heretofore unknown virus, polio, or a host of other pathogens, the upcoming Hajj presents significant public health risks. The annual event attracts millions of pilgrims every year and is therefore an "ideal environment for spreading infectious diseases," according to the U.S. CDC. Although the Saudi government has mandated several vaccinations and dedicated considerable resources to lower infectious disease risks, its personnel cannot track pilgrims once they have left the country. And while the WHO has already issued basic case definitions for identifying infected patients, healthcare system deficiencies abroad could allow potential cases to slip through the cracks and go underreported.

Home to roughly 200 million Muslims, Indonesia is sending the world's largest contingent of hajj pilgrims (approximately 200,000). At home, the vast majority relies upon a decentralized healthcare system that suffers from poor information sharing and one of the most inadequately staffed healthcare workforces of any ASEAN nation. Those with means increasingly seek medical treatment abroad. The trend has become pronounced enough for Indonesian president Susilo Bambang Yudhoyono to implore the public, in August 2012, to utilize domestic medical facilities, despite having availed of foreign medical care himself. Indonesia is ill-equipped to track diseases over a territory that spans 17,500 islands even under normal circumstances. There's been speculation that an individual returning home from the Hajj was responsible for the reintroduction of polio into Indonesia in 2004 (via a strain of the disease traceable back to northern Nigeria).

As the second-largest Muslim majority country, Pakistan's quota for pilgrims is more than 179,000, though only about 95,000 Pakistani Muslims plan to take part in the hajj. Even so, recent developments in the country's healthcare sector could impede epidemiological surveillance of returning pilgrims. In 2011, Pakistan devolved its health ministry, relegating previously centralized functions to a variety of provincial and federal-level institutions. Responsibilities for disease surveillance are now fragmented between multiple government agencies and power struggles are reportedly common. While Pakistan may eventually develop a more cohesive public health system, the current state of surveillance is worrisome in the run-up to the hajj.

Some smaller contributors of pilgrims, such as Syria, may also be ill-prepared to catch cases of infection. Current unrest in that country, which has produced considerable strain on the healthcare system, could severely slow down the detection of unusual disease symptoms.

Should pilgrims come home with an infection acquired during the pilgrimage, there may be little to stop the disease from going undetected and infecting others. Whether the newly discovered coronavirus turns into a significant public health threat or not, its emergence reveals the danger that exists when health services are compromised, but the evolution and spread of disease are not.

Scott Rosenstein is director and Aditya Bhattacharji and Daniil Davydoff are analysts in Eurasia Group's Global Health practice.

By Ayham Kamel

Iranian leaders believe more and more that Western and Arab involvement in the uprising against Syrian President Bashar al Assad is designed to weaken the Islamic Republic. Tehran feels threatened by the so-called Sunni Triangle's (Turkey, Qatar, and Saudi Arabia) support for Syrian rebels, which Iran views as a complement to sanctions that aim to limit its regional influence and prestige. The United States's alliance with these countries makes it more difficult to resolve any disagreements over Syria. In this context, Iran finds supporting Assad -- at least in the near term -- as the best worst option. This policy isn't new, but the parameters of what Tehran is willing to provide have expanded.

The audacious bombing of the National Security Council in Damascus on 18 July probably represented a watershed moment in Iranian thinking about the uprising in Syria. The "nuclear" option, dispatching units of the Iranian Revolutionary Guard Corps to assist Assad's weakened forces, is very unlikely -- it would likely trigger a so-called Chapter 7 UN resolution authorizing Western military intervention or provide enough impetus to inspire a coalition of the willing. But Tehran, now more than ever, is willing to do more to help Syria's embattled president.

First, the Iranian regime is likely to divert perhaps tens of millions of euros to help Assad counteract the flight of foreign reserves. It views support of Assad as important enough to justify the diversion of scarce reserves despite the increasing domestic economic pain caused by international sanctions. Second, Iran is likely to boost its provisions of arms and intelligence to the Assad regime. It has so far been reluctant to provide a large amount of support out of fear that doing so would play into the Syrian opposition's efforts to divide the regime's base on sectarian grounds. As the threat to the Assad regime has grown, that calculus has changed. Finally, Hezbollah forces have a great deal of fighting experience that would be valuable to Assad. However, the regime will likely dispatch them in a covert manner to avoid destabilizing the Lebanese government.

Iran, for now, may have an unrealistic view of Assad's chances of staying in power, and of its own ability to influence the outcome. It is likely that Iran will eventually reduce or eliminate its assistance to Assad as the latter's position grows increasingly untenable. Biting sanctions, declining oil revenues, rampant inflation, and dwindling foreign reserves will force Iran to focus internally. In the long run, the Islamic Republic will not be able to afford supporting a sinking Syrian regime either financially or diplomatically.

Ayham Kamel is an analyst in Eurasia Group's Middle East practice.

By Crispin Hawes

The death of Saudi Arabia's Crown Prince Nayef bin Abd al-Aziz, though unsurprising, highlights the risk of policy stagnation, an issue of some significance for the Kingdom given its domestic challenges.

As expected Nayef's full brother and appointed successor, Minister of Defense and Aviation Salman bin Abd al-Aziz, has been anointed as Crown Prince. But the current generation of princes-the sons of the kingdom's founder, Abd al-Aziz Ibn Saud-is facing the end of its period in power, which has lasted since their father's death in 1952. There are a few potential candidates to succeed Salman, but the most obvious choices are the Deputy Interior Minister Ahmed (a full brother of Salman and Nayef), Muqrin, a longtime ally of King Abdullah and the General Director of the Saudi Intelligence Agency, and Sattam, Governor of Riyadh.

In broader policy terms, the government will delay any potentially controversial legislation or regulatory reforms. Moreover, there are unlikely to be any significant external or internal policy changes in the coming months. The Saudi regime will want to consolidate power and send a strong message (to both supporters and enemies) that stability will be maintained.

The longer-term danger is that more frequent changes to the succession driven by the age of the current princes will make policy stagnation more likely, creating significant political and economic risk. The Saudi Arabian economy faces considerable challenges and social discontent over economic issues, such as growing unemployment. The current response relies on spending to drive growth and legislative changes aimed at forcing employers to hire more Saudi nationals. These policies are unlikely to address the Saudi economy's significant issues. And as age claims more of the princes in coming years, the likelihood of successive policy freezes makes the adoption of more effective policies even less likely. That outcome would likely open the door to growing social tension and stresses in Saudi Arabia, a regional lynchpin and a vital source of energy for the global economy.

Crispin Hawes is the director of Eurasia Group's Middle East practice.

By James Fallon and Ayham Kamel

On May 21, the Lebanese Armed Forces shot and killed prominent Sunni Sheikh Ahmed Abdul Wahed as his convoy passed through a checkpoint, triggering gun battles in Beirut's Tariq al Jdeideh neighborhood between two Sunni political parties, the anti-Syrian Future Movement and the pro-Syrian Arab Movement Party. The fighting followed clashes between Alawites and Sunnis in Tripoli in response to the arrest of Shadi al Mawlawi, a Sunni Salafist activist accused of aiding the Syrian opposition. Clearly, Syria's troubles have crossed the border into Lebanon.

In fact, Syria's turmoil is polarizing Lebanese factions and threatening the country's delicate political balance. Conflict in Syria has fallen largely along sectarian lines, and it is now fueling sectarian tension in Lebanon. The majority of protesters facing daily violence from the Syrian regime are Sunni, and this has driven moral and material support for their cause from Lebanon's mainly Sunni north. To avoid confrontation with his Sunni community, Prime Minister Najib Mikati has not actively interfered to stop such assistance, creating a perception that his government is at least tacitly complicit in supporting rebels.

Ironically, the one cross-sectarian institution in Lebanon that many consider capable and trustworthy -- the country's armed forces -- is a problematic tool for ending street violence between Lebanon's political parties. On the one hand, the sectarian diversity within the army gives it some level of credibility with all of Lebanon's various factions. In fact, in May 2008, when Hezbollah gunmen fought Sunni militias for control of mainly Sunni neighborhoods in west Beirut, the army helped defuse tensions on both sides -- greatly bolstering its credibility and national popularity. Yet, then as now, the army could not directly intervene to stop the bloodshed, because the sectarian fault lines that run through the country's politics and society are also apparent within its ranks. Prime Minister Najib Mikati knows that if he calls on them to engage directly, there's a risk that soldiers will join the various fights instead of breaking them up.

Recent unrest is exacerbating this fear. During clashes on May 21, Sunni gunmen directed their fire at the army. Following the checkpoint shooting, the army withdrew from some positions in the north, and several Sunni politicians called for a more permanent expulsion. The military's response was measured, but the rise of militant factions in northern Lebanon is making it much harder for the army to intervene in battles in which its soldiers may feel they have a stake. These conditions could be an indication that the army's tenuous role as super-sectarian arbiter is deteriorating among some Lebanese, particularly the Sunni population. As the Sunni-dominated northern region of Tripoli and its surroundings continue to serve as a logistical base for Syrian rebels, we'll probably see more of these clashes, and the government's ability to deploy forces without risking its credibility will definitely diminish.

Political instability is likely to rise in Lebanon as the Syria crisis worsens, and efforts better spent on the already difficult task of governing will be redirected toward buttressing the fragile balance necessary to maintain any government at all. Lebanon's political institutions have proven resilient in the face of serious challenges over the years, but that resilience is often the result of choosing to do nothing that might fan the country's flames.

Inaction may avoid making matters worse, but it does little to resolve the underlying causes of persistent instability in Lebanon.

James Fallon is an associate with Eurasia Group's Middle East practice. Ayham Kamel is an analyst in the firm's Middle East and North Africa practice.

By Ayham Kamel

It may be tempting to view the plethora of recent gatherings -- the Arab League summit, the U.S.-Gulf Cooperation Council Strategic Cooperation Forum, and the Friends of Syria conference -- as evidence that the global community is getting more serious about addressing the violence in Syria. But the summits really just exposed the rifts among the relevant players that will prevent a viable and coordinated response. Syrian President Bashar al Assad, in turn, will profit from the lack of coherence; he will only nominally entertain Kofi Annan's peace plan as he maintains his grip on power, and the bloodshed will worsen.

International powers remain hesitant regarding any form of direct intervention. They considered initiatives calling for buffer or humanitarian zones, but ultimately no country seems prepared to act. Key powers appear to be pursuing their distinct policies, with only a hint of coordination.

Saudi Arabia and Qatar will provide extensive support -- including arms -- to the Syrian opposition, but are unlikely to supply the heavy arms that would lead to an immediate change in the balance of power. Heavy arms are more difficult to smuggle and training rebels would be much more challenging than during the Libyan conflict. Moreover, the escalation could provoke an un-calculated response from Assad's military. While their interests differ, the two powers see Assad's survival as a threat to their influence. Riyadh's purpose is to limit Iran's regional influence. Meanwhile, Doha has invested significant diplomatic and political capital in the struggle against Assad and any failure to deliver would represent a tangible setback to its prestige. Behind the armament policy is also a deep concern that if Assad regains control, Damascus and Tehran would aim to destabilize the al Saud and al Thani ruling families' grip on power.

Arming the rebels, who have had trouble obtaining ammunition sine the regime began its extensive military campaign in early February, will provide much needed psychological support and will help weaken Assad's forces. While the resolve of Syria's opposition will not abate, arms from the Gulf will neither arrive overnight nor will they immediately change the balance of military power, which is still heavily tilted in the regime's favor. An equally important element of the Gulf strategy is providing monetary incentives to officers in the Syrian army to incite defections. But Assad has built multiple safeguards to prevent defections, a tactic he inherited from his father.

The U.S. is willing to overlook, perhaps even support, GCC efforts to weaken Assad. But Washington is definitely not interested in playing an active role. It is concerned about Saudi Arabia's and Lebanon's support of Salafist rebels and al Qaeda leader Ayman al Zawahiri's call for jihad in Syria. While Sunni monarchies in the Gulf benefit from rising sectarianism in Syria, the U.S. interest in long-term regional stability could be compromised if the Sunni-Shia confrontations spread to Iraq and other countries. U.S. officials believe that a political settlement will be needed to prevent prolonged instability. Verbal support for the Annan process is a reflection of the desire to keep negotiations open, but U.S. officials are convinced that under current conditions the Annan plan will only enable Assad to retain power.

Assad will probably not implement key elements of the Annan peace plan, which calls for a halt of hostilities from all sides, and a negotiated settlement between the regime and the opposition. The regime views cooperation with the UN envoy as a way to secure the successes achieved by its military strategy and to gain some breathing space. While Annan is a shrewd diplomat, there are few reasons to think that success is in reach. Syria's opposition will probably not negotiate with Assad or agree to a settlement that keeps him in power. Meanwhile, there are no indications that the Lion of Damascus has reached a point where he would accept his own ouster.

Ayham Kamel is an analyst in Eurasia Group's Middle East and North Africa practice.

By Ayham Kamel

Recent, though futile, efforts to resolve the crisis in Syria have demonstrated the absence of leadership from global powers such as the U.S. and likely set the stage for possible contagion. The unwillingness of the major powers to intervene in crises such as in Syria -- a marker of what Eurasia Group has called the G-Zero World -- has allowed regional players to step into the breach, notably Qatar via the Arab League. But the League's efforts have also exposed a regional power vacuum and tensions among Middle East nations that could potentially escalate into a proxy war in Syria.

The Arab League's late-January initiative called on President Bashar al-Assad to step down, leaving the vice president to negotiate with the opposition, but it reflects neither the complexity of the Syrian conflict nor the domestic power balance. For example, the opposition is still deeply divided and there is still considerable support for the regime among business interests and some minorities. The Syrian regime is likely to retain power throughout most of 2012, but the risk of collapse will rise considerably in the last quarter.

Other players have taken advantage of major powers' unwillingness to get involved in Syria. Qatar has been pushing for more hawkish Arab League policy on Syria, but the organization lacks the power to push through such initiatives. Turkey, Iran, and Saudi Arabia have also staked out a role. But, the lack of interest in producing a negotiated solution effectively means that the Syrian regime can disregard the Arab League on many issues.

Divisions in the League between Gulf Cooperation Council (GCC) states and other members also limit the group's ability to formulate and pursue effective policies. The 24 January decision by the GCC to withdraw monitors from Syria highlights this division. Both Egypt and Algeria, traditionally important players in the organization, are uncomfortable with what is increasingly seen as Qatari and Saudi dominance. In the near term, Egypt's leverage will likely decrease given its own political transition, but major stakeholders (such as the military and the Muslim Brotherhood) will eventually seek a more proactive foreign policy. Within the GCC, there is also a subtle, but important, tension between Qatar and Saudi Arabia. Saudi royals are wary of Qatari calls for direct military intervention as a tool for democratic reform in Syria or any other Arab countries, a precedent that could be later used against Riyadh.

Syria is a key part of the regional balance of power between moderate pro-U.S. states and the so called resistance camp lead by Iran. Seeking a broader realignment in the Middle East, regional powers are likely to increase their support of their local allies. Saudi Arabia, Turkey, and Qatar are actively encouraging the uprising driven by conservative Sunnis. Meanwhile, Iran is providing the Assad regime with intelligence, and technological equipment to suppress the uprising.

The Syrian conflict has fanned Sunni-Shiia tensions and the risks of contagion in Lebanon, Jordan, and Iraq are considerable. In Iraq, Sunnis are emboldened by a resurgence of conservative movements across the Middle East. Lebanon could become more unstable as the Syrian conflict has divided political factions in an increasingly delicate struggle. Jordan's own communities could reconsider their allegiance to the Hashemite monarchy as communal divisions between Jordanians of Palestinian descent and tribal elites begin to increase. Potential Syrian or Iranian support to Kurdish separatist groups in Turkey is likely to become a problematic issue. Finally, covert action by either the Sunni axis (Saudi Arabia, Qatar, and the Arab League) or Shiias (Iran and Iraq) entails significant risks to regional stability and could spur a violent proxy war that would hurt the business environment and oil flows.

Ayham Kamel is an analyst in Eurasia Group's Middle East practice.

Today, we turn to risk #2 in our series of posts on Eurasia Group's Top Risks for 2012 and answer the most common questions we've gotten about it.

Here's a summary:

G-Zero and the Middle East - The inability/unwillingness of major powers to bolster the region's balance of force will create new turbulence across North Africa and the Middle East in 2012 as unresolved political, sectarian, and ethnic tensions threaten more unrest. Continuing protests, autocracies under pressure, new democratic regimes fighting to establish stability, and the lack of a viable regional security framework will add to the potential turmoil. As this dynamic plays out in Syria, Egypt, Iraq, Libya, Yemen and Bahrain, neighborhood heavyweights -- Saudi Arabia, Iran, and Turkey -- will vie for influence and generate friction.

Q- What does 2012 have in store for the Arab Spring?

A- Last year's Arab world uprisings will have lasting impact on North Africa and the Middle East. Protesters in Egypt and Tunisia proved they could force an autocrat from power. Demonstrators in Syria and Yemen have pushed their governments to the brink. Muammar al Qaddafi, in power since the Beatles were cutting albums, is dead. Saudi Arabia had to send troops across the King Fahd Causeway to prevent insurrection in Bahrain.

But let's not overstate the lasting impact of last year's upheaval. In Egypt, Mubarak is gone but his support structure lives on, and the country's next president won't be the Egyptian equivalent of Vaclav Havel. The military remains firmly in charge and will share power with the Muslim Brotherhood. The protesters who made themselves famous in Tahrir Square last year will be the odd man out as Egypt looks to form its next government.

In Syria, Bashar Assad's presidency may not survive the year, but for the moment he remains in power. Military defections are a serious worry, but so far they've been limited. Sanctions hurt, but the business elites in Damascus and Aleppo haven't yet begun siding with the opposition and calling for his ouster.

In Libya, oil production is ramping back up, though not as quickly as the new government claims, but powerful militias show no signs of renouncing their individual ambitions and joining the new Libyan army.

Bahrain continues as a majority Shia state ruled by a Sunni monarch. Monarchs in Jordan and Morocco remain firmly in place.

The governments of Saudi Arabia and Iran face no existential internal threats. The Saudis appear poised for a smooth process of succession when King Abdullah dies, and though Iranian President Ahmadinejad remains on shaky ground, Supreme Leader Ayatollah Ali Khamenei faces no direct near-term challenges.

That said, there is plenty of ongoing turmoil in some of these countries -- especially in Egypt, Syria, and Libya -- and Americans and Europeans don't believe they can afford direct intervention. U.S. troops are leaving Iraq, and there is no other outside power or alliance of powers capable of maintaining the region's delicate balance of power. That leaves local heavyweights -- especially Turkey, Saudi Arabia and Iran -- to compete for influence. None of them wants to get too involved in the complicated problems of its neighbors, but as the stakes rise in these less stable countries, they also face the risk of doing too little to bolster stability and to counter-balance their local rivals.

In short, the Middle East is top risk #2 this year because the absence of outside powers and the rivalries of local players could further destabilize a region that has already had its share of uncertainty and local violence.

Q- Syria remains in the headlines and there seems to be more violence in Iraq these days. What can we expect in these two countries?

A- In Syria, the risk is that prolonged stalemate will force the neighbors to intervene and bring things to a head. So far, the Arab League, led by Qatar, is most directly involved. As outside pressure on Assad increases, Iran may feel it has to bolster his government, one of the Islamic Republic's few reliable friends. The Saudis may decide that bringing the turmoil to a close means using their leverage to force Assad out, empowering Syria's Sunnis in the process. Turkish Prime Minister Erdogan's government may join them to put an end to the violence that has pushed many Syrians across the border into Turkey. Assad's fate may not be resolved quickly or easily, however, and Syria's troubles may extend well into 2012.

In Iraq, sectarian rivalry is filling the vacuum left behind by departing U.S. troops. Until recently the most exciting investment story in the Middle East, Iraq's stability is again in question. Nouri al-Maliki's government is no longer intent on accommodating Sunni Arab powerbrokers to keep the peace. In response, Sunnis who once opposed Kurdish demands for greater autonomy are now pushing to create a semi-autonomous bloc of their own in the Sunni-majority western provinces of the country. Here again, Iran, Saudi Arabia, and Turkey may calculate that they can't afford to hang back and let their rivals build new influence inside this country.

Q- What about Israel?

A- On the one hand, Israel will become more isolated. The Obama administration wants to reduce its risk exposure in the Middle East -- at least to the extent possible given the region's lasting importance for the United States -- and to focus more of its attention and resources on East Asia. In addition, Israel recognizes the surge of populism across the Arab world, and relations have become much more complicated with Egypt, Jordan, and Turkey. Add Iran's determination to continue development of its nuclear program and Israel will be on edge throughout this year. The risk has increased in recent weeks that Israel will face more violence in 2012 -- both within Israel and perhaps with Lebanon.

That said, whatever the differences between President Obama and Prime Minister Benjamin Netanyahu, U.S.-Israeli relations remain central to the domestic political health of both governments. Israel is not going it alone. And an Israeli military strike on Iran remains unlikely for two reasons. First, sanctions weaken Iran, even if only by forcing Tehran to sell oil to Asian states that will pay well below market prices for it. Second, sabotage, including via cyberattacks, appears to have slowed Iran's momentum in centrifuge development. This is a much less expensive and less dangerous approach than the conduct of bombing raids on Iranian territory.

Next up, another year of uncertainty for the eurozone.

By James Fallon

President Ali Abdullah Saleh's sudden return to Yemen will be destabilizing, but will not change the underlying dynamics of the country's political conflict. Saleh recently returned to the capital Sana'a after some three months of medical treatment in Saudi Arabia following a June assassination attempt that left him severely wounded. His return came amid renewed clashes between pro- and anti-Saleh forces in the capital that erupted after security forces killed protesters on Sept. 18.

Saleh called for a ceasefire in an effort to position himself above the fray, but attempts to paint himself as a mediator are unlikely to succeed. Despite Saleh's absence from the country and nine months of protests against his 33-year reign, he retains some support, a factor that has led to a protracted stalemate rather than his overthrow.

Saleh will not be able to regain control of Yemen. He could, however, potentially extend the stalemate for months, degrading stability even further in the process. Although widespread military and political defections have occurred, pro-Saleh units are better equipped and led by loyal family members. Both sides enjoy some tribal support as well. The ultimate balance of military power remains unclear, but if fighting escalates, it is unlikely that either side would enjoy a decisive advantage.

Although this reality could spur dialogue, the more likely outcome is a protracted and indecisive armed conflict. A political agreement along the lines of the GCC-brokered transition deal is unlikely to solve Yemen's deeper crisis or restore central government control over the country. State stability is very likely to continue to devolve in any scenario.

Al Qaeda in the Arabian Peninsula (AQAP) is one potential beneficiary of this situation. AQAP has gained more space to operate as a result of the conflict, with Islamist militants sympathetic to the terror group seizing territory in the south of the country. The Yemeni regime has parlayed the AQAP issue to manipulate external support, resulting in a greater degree of patience from the international community than has been the case in other Arab uprisings.

There is both regional and international consensus on Saleh transferring power, but the same is not necessarily true for his family members and allies in key security positions. Outside actors probably still view maintaining the coherence of counter-terrorism units as a preferential outcome, despite their politicized role and intimate links to the Saleh regime. The European Union, United States, United Nations, and the Gulf Cooperation Council meanwhile are likely to continue to pressing for negotiations for a political transition, but they do not have the capacity to bring a swift end to the Yemeni crisis, further increasing the risk of a protracted and violent stalemate.

James Fallon is an associate with Eurasia Group's Middle East practice.

By Cliff Kupchan

News that Tehran is reportedly planning to deploy faster centrifuges at a hardened site and intends to triple production of highly enriched uranium increases somewhat the risk of Israeli strikes, if Iran can follow through. If these steps are successfully implemented, Iran would have the ability to make a nuclear weapon more quickly. However, Tehran frequently overstates its capabilities, and the degree of looming threat is uncertain. Observers will need to watch future International Atomic Energy Agency (IAEA) statements carefully.

If Iran places both advanced generation machines and a large stockpile of 19.75 percent uranium at the hardened Fordo site near Qom, the threat of dash to a bomb would significantly increase. Even using very conservative assumptions, Iran could make a bomb in 12-18 months, depending on how many advanced machines are deployed, their efficiency, and other factors. The possibility that Fordo may not be vulnerable to air strikes increases the chance an Iranian breakout could succeed.

There are doubts, however. First, Iran's ability to make and operate advanced machines that work well, individually and in cascades, is uncertain. Second, Iran may not have enough component material to make large numbers of advanced machines.

Several explanations are possible for why Iran is, rhetorically at least, again emphasizing its nuclear program. Supreme Leader Ali Khamenei may now feel the need to boost the regime's domestic legitimacy and international influence, for two reasons. The Iranian regime is concerned about the effect of Syrian President Bashar Assad's possible fall on its regional clout, and may seek to augment that clout through progress on the nuclear program. In addition, Khamenei faces the prospect of a low turnout from a disaffected population at parliamentary and presidential elections in 2012 and 2013, and could be seeking to preempt a loss of legitimacy through nuclear advances. Finally, Iran may have made at least enough progress on advanced centrifuges to deploy two cascades and reap the political benefits of doing so.

The central question is how quickly Iran is able to move forward. Several signposts in quarterly IAEA reports will be telling. The reports will reveal how quickly Iran deploys the two test cascades and then how quickly, in what quantity, and with what efficiency Tehran deploys these machines at Fordo. Finally, these documents will provide information about how much 19.75% material is being accumulated.

The chance of Israeli strikes remains now very low for now, as Israel has been pleased with the effect of covert action and sanctions. But Israeli officials have revealed increasing concern over these issues. Progress by Iran on the above agenda will increase the chance of strikes; movement of advanced centrifuges into Fordo would be especially provocative. Unless Israel believes it could successfully attack the hardened site, it will face a very tough decision point. This more dangerous scenario would very likely rattle markets.

Cliff Kupchan is a director with Eurasia Group's Middle East practice

By David Gordon and Cliff Kupchan

"You don't want a messianic apocalyptic cult controlling atomic bombs," Israeli Prime Minister Benjamin Netanyahu told a journalist in 2009, in reference to Iran's nuclear program. He wasn't the first or last Israeli official to use such inflammatory rhetoric. References to Iran as an existential threat or to the country's nuclear program as raising the specter of another Holocaust have been typical among Israeli officials. But on a recent research trip to Israel, we heard surprisingly little anxiety. No official spoke about a threshold beyond which Iran's program would be unstoppable -- a deadline that in the past was always one year off. And elites across the political spectrum for now favor sanctions and covert action, rather than military force, to deter Iran. As a result, the chance of Israeli strikes in the next eighteen months is very low.

So what accounts for the sea-change in the Israeli approach? Success, essentially. Iranian officials have claimed that successive rounds of international sanctions have benefitted the country by forcing it to adopt necessary economic reforms. But top Israeli officials stressed to us that sanctions are crippling Iran's economy and sparking debate about nuclear policy among the ruling elite. Likewise, the triumph of the Stuxnet computer worm -- credited with destroying 1,000 Iranian centrifuges and widely believed (though not confirmed) to be an American-Israeli creation -- and possibly other covert measures have encouraged Israeli policymakers. While officials wouldn't talk in detail, they said that Iran's nuclear program has been slowed.

Buying time is an important reason to stick with sanctions and covert action. For one, as the repercussions of ever harsher sanctions sink in, Tehran may be forced to make concessions at the negotiating table. Second, in the wake of Stuxnet, Israel is probably more optimistic about its ability to impair Iran's nuclear program over the long term. Third, an extended time horizon opens the door for domestically induced regime change in Iran -- a remote but real possibility that bears monitoring as disaffected crowds again take to the streets of Tehran.

There's probably also a public relations angle to Israel's transformed rhetoric. As some sources noted, breathless statements about existential threats and points of no return likely strengthened Iran's hand, both diplomatically and publicly. Moreover, Israeli public opinion has turned its gaze elsewhere, to what it considers the more imminent threats of Gaza, Lebanon, and Egypt.

It would be wrong to read the shift in the Israeli approach as a rejection of military action, though. While no sitting politician said so, there is a widespread belief among the country's elite that the government still considers force a viable option: Netanyahu would not stomach a nuclear Iran. But unless sanctions and covert action lose their credibility in the eyes of this (or a similarly inclined) Israeli government, strikes in the next year and a half will remain unlikely.

David Gordon is head of research at Eurasia Group. Cliff Kupchan is director of the firm's Eurasia practice.