An Israeli military vehicle stands during an operation near Jenin Camp, in the Israeli-occupied West Bank, 24 February 2025. REUTERS/Raneen Sawafta

US President Donald Trump’s Middle East policy will create winners and losers. Global Insight assesses the impact on the region and the potential for further instability.

US President Donald Trump’s Middle East policy is quickly shaping up. It represents a sequel of sorts to the approach he took during his first term in 2017–2020. This time, however, the stakes are higher, there are fewer guardrails and the President is showing a tendency to want to shake up the region’s chessboard.

President Trump’s policy is brashly unilateral and has seen him sideline Palestinian aspirations in the region and forge alliances with regional strongmen to counter Iran and bolster Israel. It may offer some short-term gains, but it’s poised to leave the region even more polarised and teetering on the edge of further instability.

Hints of what’s to come are already materialising in the form of President Trump’s blunt, undiplomatic quips and the growing influence of Project 2025, a sweeping policy blueprint crafted by the Heritage Foundation. Though not official doctrine, the ideas within this document – which runs to over 900 pages – have seeped into the President’s inner circle, with several of its architects now holding key government roles.

The guiding star is a hard-nosed prioritisation of US interests – as President Trump and his allies define them – over multilateral diplomacy. This means offloading security costs to regional powers, disregarding institutions such as the UN and the EU and doubling down on transactional relationships.

President Trump’s deal-making flair is on full display in the Middle East, especially when it comes to the oil-rich Gulf states. He frames these relationships in dollar signs, highlighting Saudi Arabia’s $450bn investment pledge, made during his first term in office. With his characteristic bluntness, President Trump has quipped that if Riyadh purchased another $450bn or $500bn of US products, he’d happily jet back there for another visit. ‘The money means nothing to them’, he declared in a speech in Las Vegas in early 2025.

This pragmatism is behind the push proposed in the Project 2025 document to shift security expenses onto Arab regimes while dangling lucrative arms deals and scaling back Washington’s direct military involvement. One bold Project 2025 proposal envisions a Red Sea security alliance, bringing together Egypt, the Gulf states and – notably – Israel and potentially India to counter Iranian influence and proxy groups such as Iraqi Shiite militias, Hezbollah in Lebanon and the Houthis in Yemen.

The end of the two-state solution

US policy towards Israel shows no signs of changing. Washington will keep the aid and arms pipeline flowing, cementing Israel’s military dominance in the region. The Trump administration has resumed the delivery of heavy munitions to Israel after former President Joe Biden halted them amid mounting civilian casualties in the Gaza conflict. In doing so it has underscored its unwavering support.

President Trump’s pick for US Ambassador to Israel is Mike Huckabee, a Baptist minister known for his strong backing of Israeli regional expansion. The choice signals that the President will approve Israel’s territorial ambitions. If confirmed, Huckabee would be the first evangelical Christian Zionist to hold the position.

For the Palestinian Authority (PA), however, the outlook dims. President Trump’s previous reductions in US funding for the PA and UN humanitarian programmes aiding Palestinian refugees will probably continue, further marginalising the Palestinian leadership. Even as the PA remains a rival to Hamas, its influence is fading – and President Trump’s policies offer little hope for revival.

In Gaza, the Trump administration has drawn a hard line – Hamas can’t remain a military or governing force. While this stance aligns with Israel’s objectives, it risks igniting further conflict. The leaders of Hamas have already bristled at the idea, vowing retaliation against any force that seeks to do Israel’s bidding, regardless of who they are.

The two-state solution to the Israel-Palestine conflict, once a cornerstone of US diplomacy, now seems to be fading into obscurity. President Trump’s focus is on leveraging security guarantees and business deals to nudge a half-hearted Saudi Arabia toward normalising ties with Israel – potentially by pressuring Riyadh to drop its demand for Palestinian statehood as a precondition. President Trump’s son-in-law, Jared Kushner, is expected to play a major advisory role in this respect due to his strong pro-Israel stance and business connections with Gulf Arab monarchs, alongside his previous experience in drawing up the Abraham Accords that normalised Israeli relations with several Arab countries during Trump’s first term. This approach, however, risks yet again alienating the Palestinians and stoking tensions across the region.

The region also remains stunned by President Trump’s suggestion that the US take over Gaza, force out its 2.3 million people, permanently resettle them outside of the area and build a Mediterranean-style riviera there. Commentators have warned the plan could undermine stability in Egypt, Jordan and Saudi Arabia – countries whose authoritarian but America-friendly regimes the US has, ironically, spent years bolstering.

Winners and losers

President Trump’s strategy on Iran has so far oscillated between coercion and ambiguity. On the one hand, he has reaffirmed a red line against a nuclear-armed Tehran, threatening ‘crippling’ sanctions and a return to the ‘maximum pressure’ policy that saw him withdraw the US from the Iran nuclear deal in 2018. The US Secretary of State, Marco Rubio, said during a February visit to Israel that Washington’s policy rests on considering Iran as ‘the single greatest source of instability in the region’.

On the other hand, President Trump has teased the possibility of a ‘stronger deal’, leaving the door open to diplomacy. ‘I would much prefer a verified nuclear peace agreement, which will let Iran peacefully grow and prosper’, he said in early February.

It’s clear who’s set to be a winner as a result of the Trump administration’s policies. Israel will receive even stronger US backing for territorial claims, the legitimisation of settlements built on the occupied West Bank and deeper regional integration. Arab Gulf states such as Bahrain, Saudi Arabia and the United Arab Emirates, along with Egypt, will benefit from increased counter-terrorism cooperation, support for domestic policies and arms deals.

The losers, however, are equally clear. Palestinians face further marginalisation, the defunding of UN aid agencies and a narrowing path to statehood. Iran, already reeling under sanctions, may face intensified economic warfare – or even military brinkmanship.

Yet the success of these policies is far from guaranteed. Regional players have demonstrated that they too can be unpredictable, springing into action and derailing outside plans. The attacks on 7 October 2023 by Hamas against Israel were partly fuelled by frustration about normalisation efforts that Hamas saw as a brushing aside of Palestinian concerns. Attempts to reshape the region without addressing these grievances – which have for decades been the Middle East’s most pressing issue – risk creating further turmoil.

Moreover, President Trump’s approach has so far paid no attention to the rising tide of public frustration in the Middle East against autocratic rule and what they see as overbearing American policies. The failure of Arab leaders to stem the humanitarian crisis in Gaza, for example, has left ordinary citizens whispering about the viability of the status quo and the need for a change towards leadership that’s more accountable.

The Middle East in President Trump’s second term will probably be a high-stakes arena, where power plays, business deals and ambitious partnerships try to script the course of events. This may bring some short-term wins – such as deals between Israel and the Arabs – but the Trump administration’s hawkish positions towards the Palestinians and Iran could cause further chaos in the region. What’s certain is that President Trump’s policies will etch an indelible mark on the region – for better or worse.

Emad Mekay is a freelance journalist and can be contacted at emad.mekay@int-bar.org