🟩 CIA authorized to operate in Venezuela, Trump walks back China tariff threat, Budapest to host US-Russia meeting on Ukraine || Global Risks Weekly Roundup #42/2025.

90% (86% to 92%) chance that former US National Security Advisor John Bolton will be convicted.

Executive summary

Top items:

• Geopolitics: Trump authorized the CIA to carry out covert and lethal operations in Venezuela. Putin and Trump agreed to meet in Budapest for a fresh discussion on how to end the war in Ukraine. Zelensky tried but failed to secure Tomahawk missiles from the US.

• Economy: Trump said that imposing an additional 100% tariff on China would not be workable. Two regional banks in the US disclosed issues with bad loans.

• Tech and AI: The UK’s internal security agency, MI5, warned of scenarios in which humans might lose oversight and control of AI.

• Biorisk: We may be in a multi-year pre-pandemic phase with the influenza D virus.

• Nature and climate: Low- and mid-latitude oceans are becoming less green, as warming waters reduce photosynthesis.

Forecasts:

• Forecasters believe there’s a 68% (20% to 80%) chance that there will be a rocket or missile attack on Israel (hitting Israel’s land or intercepted by its air defence systems) that is launched from Gaza by the end of January 2026, and an 86% (50% to 95%) chance of such an attack before 2027.

• They think there’s a 90% (86% to 92%) chance that former US National Security Advisor John Bolton will be convicted of at least one of the charges related to the transmission of classified information on which he was indicted.

• They believe there’s a 14% (5.0% to 30%) chance that they will collectively judge Russia and Ukraine to have agreed to substantive concessions by the end of 2025, if the Trump-Putin summit in Budapest goes ahead.

• They think there’s an 89% (80% to 95%) chance that Trump and Xi will meet in person before November 3, 2025.

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Geopolitics

Middle East

Gaza’s media office accused Israel of violating the ceasefire with Hamas on multiple occasions, resulting in the death of 38 Palestinians and the wounding of 143. Israel, in turn, accused Hamas of violating the ceasefire, as well as of failing to return the bodies of dead hostages in a timely manner. Aid deliveries to Gaza have been delayed, and the Rafah crossing remains closed. However, the two sides continued to return the remains of deceased prisoners and hostages. Some of the bodies returned by Israel reportedly show signs of torture, while hostages and prisoners released by both Hamas and Israel have alleged that they were tortured.

Forecasters believe there’s a 68% chance (20% to 80%) that there will be a rocket or missile attack on Israel that is launched from Gaza by the end of January 2026, and an 86% chance (50% to 95%) before 2027. This would be an attack that either hits Israeli land or is intercepted by Israeli air defence systems. Forecasters point out that the base rate for such an attack is that there has been no year since 2,000 where no rockets were fired at Israel. The lowest years were 2015-2017 ranging from 15-35 attacks. On the other hand, Hamas has shown a willingness not to expand the fighting since the ceasefire went into place. Ceasefire conditions were quickly restored following the recent attack by Hamas on Israeli forces in Gaza City and the subsequent Israeli retaliation.

Multiple countries, including Indonesia, Azerbaijan and Pakistan, are in talks to provide troops for the Gaza stabilization force envisaged in the US peace plan.

The Joint Comprehensive Plan of Action, also known as the Iran nuclear deal, has officially expired after 10 years. The UK, France and Germany have already reimposed sanctions, while Iran says it is no longer bound by the terms of the agreement, which included a cap on the enrichment of uranium at 3.67%.

Around 1,500 prisoners on death row in Iran have begun a hunger strike to protest the execution of their fellow inmates, with around 170 prisoners having reportedly been executed in just over three weeks. An opposition organization suggests that the executions are intended to instill fear in opponents of the Iranian regime.

Europe

US President Donald Trump and Russian President Vladimir Putin agreed in a phone call to meet in Hungary to discuss how to end the Russia-Ukraine war. Notably, Budapest is where an eponymous memorandum was signed in 1994, which gave Ukraine security assurances from Russia and pledges of non-military support from the UK and the US in exchange for Ukraine giving up its nuclear weapons. However, even if the meeting goes ahead before 2026, forecasters are relatively pessimistic about the prospect of a meaningful breakthrough, believing there’s only a 14% chance (5.0% to 30%) that they will judge Russia and Ukraine to have agreed to substantive concessions by the end of 2025. Forecasters mostly see minor concessions from Putin to keep the meeting from looking like the Alaska summit.

Not long after the call, Trump met with Ukrainian President Volodymyr Zelensky at the White House and urged him to accept Putin’s terms for ending the war, telling him that Putin would “destroy” Ukraine if he didn’t agree to those terms; however, Trump did later support freezing hostilities along current front lines. In the White House meeting, which reportedly repeatedly degenerated into a “shouting match,” Trump also downplayed prospects that the US would supply Ukraine with Tomahawk missiles but said that this might happen if Russia continues the war. Tomahawk missiles are long-range, guided missiles that would better enable Ukraine to carry out strikes deep in Russian territory.

In addition to targeting Russian oil and gas infrastructure with drone strikes, Ukraine has also been systematically targeting Russian substations that transmit power to central Russia, including Moscow.

NATO defence chiefs continue to discuss the possibility of shooting down Russian aircraft that violate NATO territory.

The Americas

South America

The Trump administration continues to put pressure on the Maduro regime in Venezuela. Trump acknowledged that he authorized the Central Intelligence Agency (CIA) to conduct covert and lethal operations in Venezuela and the Caribbean region. The US military is also examining options for strikes in Venezuelan territory, with Trump saying that, “we are certainly looking at land now, because we’ve got the sea very well under control”.

Trump also backed up reporting that Venezuelan President Nicolas Maduro offered the US substantial access to its natural resources, saying it was because Maduro doesn’t want to “f— around” with the United States.

Venezuela’s Vice President Delcy Rodríguez and other officials have reportedly tried to persuade the US to back a transitional arrangement in which Maduro would eventually step down and the US would gain further access to Venezuela’s resources. However, the Trump administration rejected two offers, made in April and September via mediaries in Qatar, deeming each a mere “makeover,” and Rodríguez denied the reports.

An alleged drug-trafficking vessel was struck by the US Navy last Thursday; two survivors pulled from the water by the US will be sent to their home countries of Ecuador and Colombia. A seventh alleged drug-trafficking vessel was also struck on Friday, and all three on board were killed.

The buildup of US military ships, planes and resources in the Caribbean continues. Three US Air Force B-52 Stratofortresses, accompanied by F-35s notably armed with AIM-9X missiles mounted externally, flew in a bomber attack demonstration mission near Venezuela, in a show of force.

Some analysts and members of the Venezuelan opposition believe that the administration seeks regime change in Venezuela, preferably by convincing elements within the government to remove Maduro or forcing Maduro himself to take that decision.

US Southern Command (SOUTHCOM) commander Admiral Alvin Holsey unexpectedly announced that he will retire on December 12. His area of operations includes the Caribbean, where the US has now sunk at least five alleged drug boats, and Venezuela. There were reportedly tensions between Adm. Holsey and Secretary of War Pete Hegseth over concerns about the mission focusing on Venezuela and attacks on alleged drug-trafficking boats. Lawmakers have raised concerns about the legality of the Navy’s strikes on boats.

United States

Former US National Security Advisor John Bolton was indicted on 18 counts relating to the improper retention and transmission of classified material. The Justice Department had reportedly begun looking into Bolton’s alleged activities relating to these indictments during the Biden administration; a separate, earlier investigation had been initiated in 2020 during the first Trump administration but was dropped in 2021. Bolton has pleaded “not guilty”. Forecasters believe there’s a 90% (86% to 92%) that Bolton will be convicted of at least one of the charges, calling the indictment a “slam dunk”.

Millions of people joined anti-Trump “No Kings” protests throughout the United States over the weekend. Organizers said that nearly 7M people participated in protests at over 2,700 locations.

After refusing to sign an acknowledgement of a new and restrictive set of Pentagon press rules required by Secretary of War Hegseth, approximately 40-50 reporters emptied out their offices last Wednesday, turned in their badges and left the building. Many organizations across the political spectrum, including organizations favored by Trump, did not sign on to the new rules. Only 15 individuals signed acknowledgements of the new policy: four work for the conservative organizations the Federalist, the Epoch Times and One America News; several work or freelance for foreign outlets; and a couple are lesser-known independent publishers. The Pentagon Press Association, which represents over 100 news organizations, said in a statement that Wednesday was “a dark day for press freedom that raises concerns about a weakening U.S. commitment to transparency in governance, to public accountability at the Pentagon and to free speech for all.“

Marines fired live artillery from Camp Pendleton over a major highway in California on Saturday as part of a celebration of the Marine Corps’ 250th anniversary. Before the event, California Governor Newsom protested that the plan for the live-fire demonstration showed “disregard for public safety”. The California Highway Patrol (CHP) shut down a stretch of the major traffic artery as a precaution, and one CHP patrol vehicle supporting the traffic break was struck by shrapnel from an artillery round that “detonated overhead prematurely”.

The Labor Department warned in a report that food production in the US is being disrupted by the Trump administration’s efforts to deport unauthorized immigrants. The report states, “The near total cessation of the inflow of illegal aliens combined with the lack of an available legal workforce, results in significant disruptions to production costs and threatening the stability of domestic food production and prices for U.S consumers”. Around 40-60% of hired farm workers in the US are unauthorized immigrants.

Asia

Relations between India and the Taliban regime in Afghanistan have been improving, with Taliban foreign minister Amir Khan Muttaqi visiting New Delhi and being referred to as the “Afghan foreign minister” by the Indian government. India also plans to reopen its embassy in Kabul soon. (This has echoes of the “Mandala theory of foreign policy” promulgated in the ancient Indian treatise Arthashastra, in which the immediate neighbour is a natural enemy, but the neighbor of the neighbor a natural friend.)

This comes after Pakistan and the Taliban engaged in border clashes, with the Taliban claiming to have killed at least 58 Pakistani soldiers in recent operations and Pakistan professing to have killed more than 200 Taliban fighters. However, the two sides have since negotiated first a temporary ceasefire, followed by a broader ceasefire after peace talks in Doha on Sunday.

China expelled nine top generals from the Chinese Communist Party, including a Vice-chairman of the Central Military Commission, after charging them with corruption.

Cheng Li-wun, a former Taiwan lawmaker, won the contest to become the next leader of the Kuomintang (KMT) party, which is Taiwan’s main opposition party. On Sunday, the KMT reaffirmed its endorsement of the “1992 consensus,” referring to the understanding apparently reached by officials from the Chinese Communist Party and Taiwan’s KMT that both sides of the Taiwan strait are part of “one China,” and Cheng said that she wants “all Taiwanese people to be able to proudly and confidently say, ‘I am Chinese.”

China’s most recent five-year plan is coming to an end, and the next, for 2026-2030, will be formulated in closed-door meetings this week. But it will need to be communicated to the large bureaucracy, and we will be watching with interest.

Africa

At a meeting in Cairo, Egyptian President Abdel Fattah al-Sisi and Sudan’s Sovereign Council Chairman Abdel Fattah al-Burhan expressed their firm opposition to Ethiopia’s unilateral operation of the Grand Ethiopian Renaissance Dam (GERD).

The UN said that the peace deal between the Democratic Republic of the Congo and Rwanda isn’t being respected.

US Senator Ted Cruz and government officials from Nigeria became embroiled in a dispute after Cruz accused Nigeria’s government of facilitating the mass murder of Christians by Islamist forces.

Army Col. Michael Randrianirina led a rapid and successful coup in Madagascar, following three weeks of anti-government protests. The former president has fled the country. Randrianirina said that Madagascar will be governed by a military council with himself as president for 18 months to two years before any elections will be held.

Technology and artificial intelligence

In the UK MI5 Director General’s annual threat update, Ken McCallum mentioned the possibility of AIs evading human oversight and control as potential future risks that MI5 needs to scope out:

MI5 has spent more than a century doing ingenious things to out-innovate our human – sometimes inhuman – adversaries. But in 2025, while contending with today’s threats, we also need to scope out the next frontier: potential future risks from non-human, autonomous AI systems which may evade human oversight and control.

US Senate Republicans shared a deepfaked video of Senate minority leader Chuck Schumer celebrating the ongoing US government shutdown.

OpenAI stopped allowing Sora users to generate deepfakes of Martin Luther King Jr. after users made disrespectful videos.

A consortium of investors that includes Nvidia, Microsoft, xAI, BlackRock, and MGX has agreed to buy Aligned Data Centers for $40B.

Broadcom’s stock rose 9% on the announcement of their custom chip deal with OpenAI, even though previous reporting had suggested that such a deal would be negotiated.

California Governor Gavin Newsom approved legislation that requires companion chatbots to have protocols that prevent their producing content about suicidal ideation, suicide or self-harm and that direct users to crisis services if needed. The legislation also requires clear disclosures that an AI is generating conversation if users could reasonably think that they were interacting with a human.

An update to the International AI Safety Report was published, covering major breakthroughs in AI capabilities since the last report was issued in January 2025.

Sam Altman said that now that OpenAI is implementing age-gating, OpenAI will allow more capabilities in ChatGPT for adults, such as “erotica”. In an interview around the time of the launch of ChatGPT-5, 10 weeks previously, he had said that he was proud that they hadn’t put a “sexbot avatar in ChatGPT yet.”

Cybersecurity company F5 reported a more than one year-long intrusion into its software. Four out of five Fortune 500 companies, in addition to multiple US government departments and agencies, rely on this software. Some cybersecurity experts are comparing the scope of this hack to that of the SolarWinds intrusion in 2020.

Economy

Donald Trump walked back his threat to impose an additional 100% tariff on imports from China, which we reported on last week, arguing that it wouldn’t be “sustainable”. Forecasters believe there’s an 89% (80% to 95%) chance that Trump and President Xi of China will still meet in person before November 4, 2025.

China’s growing number of export controls for rare earth metals have become one source of tension in trade negotiations between the US and China; Chinese exports of critical rare earths fell in September. The US now plans to spend up to $1B to build stockpiles of rare earth metals. Treasury Secretary Bessent said in an interview that the Trump administration also plans to set price floors across multiple strategic industries, including for rare earth companies in the US, to counter market manipulation by China.

Europe stands to lose from China’s export controls on rare earths as well, as environmental concerns in European countries raise barriers to rare earth mining and refining.

JPMorganChase is launching a “Security and Resilience Initiative, a $1.5 trillion, 10-year plan to facilitate, finance and invest in industries critical to national economic security and resiliency.” JPMorgan itself plans to invest up to $10B in “select companies” as part of this initiative. JPMorgan said its new initiative would focus on four strategic sectors: “supply chain and advanced manufacturing,” including “critical minerals”; “defense and aerospace”; “energy independence and resilience”; and “frontier and strategic technologies,” including AI and quantum computing. JPMorgan CEO Jamie Dimon said that the investment decisions are not being driven by the Trump administration.

Goldman Sachs estimates that US consumers are shouldering about 55% of the costs of tariffs. And consumers continue to struggle. Auto loan delinquency rates are at their highest level in 14 years.

US regional banks are showing increasing signs of stress, even after increasing reserves to absorb credit losses and seeking more stable deposit sources since the 2023 banking crisis, according to a new Morningstar DBRS report. Morningstar DBRS expects regional banks to see more delinquencies and loan losses in the coming quarters. Two regional banks in the US, Zions Bank and Western Alliance Bank, disclosed issues with fraudulent and bad loans, leading to a short-term market selloff before the S&P 500 recovered. In 2023, three regional banks in the US collapsed in quick succession, including Silicon Valley Bank.

The price of gold reached a new record high of $4,378.69 on Friday but fell 1.8% after comments by Trump about trade with China.

The Argentine peso has fallen below the level reached before the US began to intervene to purchase the currency. The US Treasury has spent an estimated $400M on the currency since October 9, out of an announced $20B currency swap line. The Argentine peso has been falling as investors buy dollars to hedge against the possibility of bad results for Argentine President Milei in midterm elections on October 26, the fallout from which may force Milei to devalue the peso.

Biorisk

We may be in a multi-year pre-pandemic phase with the influenza D virus, which does not appear to be very virulent in humans. A new study found that approximately three quarters of the population of northeast China has likely been exposed to an influenza D virus (IDV) lineage that was first detected in cattle in the region in 2023. Influenza D viruses are cousins of the influenza A and B viruses that cause the flu in humans, and they generally infect only cattle and pigs, although evidence of some exposure in humans has been seen previously. Antibodies to the cattle strain were found in human blood samples collected from 2020 through 2024, suggesting that the virus may have been spreading among humans since at least 2020. The study also showed that the virus could transmit efficiently through the air between ferrets and that it is capable of infecting human airway cell cultures. The authors conclude that, “Our pathogenetic and serological findings indicate that IDV may have acquired the capacity for human-to-human transmission”.

It is not known to what extent the virus has been spreading among humans in northeast China, as opposed to from cattle to humans, but the extent of exposure raises the possibility that the virus may be circulating at a low level among humans, perhaps linked to cattle outbreaks, as has been seen previously to a much more limited extent in Italy. That raises the risk that the virus could become pandemic at some point over the coming years. The authors wrote, “Currently, no routine IDV testing is carried out anywhere in the world, facilitating concerns about the silent spread of this panzootic virus and the potential emergence of new varieties.”

The World Health Organization (WHO) claims that one in six bacterial infections is now resistant to standard antibiotic treatments.

The first locally acquired chikungunya case in the state of NY, which was also the first locally acquired case in the US since 2019, was reported.

Nature and climate

A new study finds that the world’s low- and mid-latitude oceans are becoming less green, most likely because warming temperatures decrease phytoplankton growth, and hence, photosynthesis. The authors write that, “These changes will profoundly affect the magnitude and distribution of marine ecosystem functioning”.

At least two active regions on the sun’s surface pose a risk of launching X-class solar flares.