On October 7, 2023, a forceful military action of the Palestinian organization Hamas in Israel
triggered dreadful humanitarian consequences for Israel, which immediately adopted resolute
measures against Hamas, with subsequent impact on heightened geopolitical risks in the Middle
East. The purpose of this article is to explore the historical context of geopolitical situation in Israel,
the social, economic and political main challenges. The paper also discusses potential solutions that
might prove adequate to restore the relations in the Middle East and appease the existing conflicts.
The analysis explores the geopolitical considerations on foreign relations normalization processes
in Middle East, with a focus on “2002 Arab Peace Initiative”. Furthermore, it presents the possible
geoeconomic impact of the Israel-Hamas conflict on Europe, discussing the main risks for the global
economy. The preliminary conclusions indicate the "two-state solution" still emerging as the most
appropriate to achieve lasting peace in the Middle East