On Jan. 5, RANE published its 2026 Annual Forecast containing our predictions for the upcoming year. This piece is designed to complement our forecast by focusing on top risks that could have a major impact on organizations and/or their operations in 2026. This report highlights two main categories of risks: high-impact, low-probability risks that are excluded from the annual forecast but could have significant implications, and trends already covered in the annual forecast but are presented here in a more extreme nature. Their ordering and numbering are not meant to represent their likelihood or risk level.
Risk #1: U.S. Strikes in Latin America Trigger Migration Flows, Insurgency
The United States aggressively expands its targeting of drug traffickers and leftist governments in Latin America, leading to significant refugee flows and insurgencies against the United States and its interests, including businesses. Following the Jan. 3 arrest of former Venezuelan President Nicolas Maduro, the United States becomes more emboldened, including potentially using the U.S. military to try to remove leftist leaders in Cuba and/or Colombia, particularly if Colombia's election brings another leftist president to power. U.S. military action in the region intensifies outward flows of migrants into neighboring countries and the United States. Depending on the nature of the U.S. military action, it may also fuel violent backlash against the United States, leading to growing insurgencies in Cuba, Colombia and Venezuela that increasingly target U.S. interests, including American citizens present in Colombia and Venezuela. To avoid extensive troop deployments, the United States will likely rely on special operations forces and air power, but this means the insurgencies are more likely to target American companies and Americans as a proxy due to the limited number of U.S. government targets. The destabilizing effects will also increase the likelihood that the United States is eventually forced to intervene militarily with troop deployments, perhaps beyond 2026, in an effort to stabilize its southern front. While the United States is unlikely to try to oust Mexican President Claudia Sheinbaum, it carries out frequent cross-border raids and attacks on drug cartels in Mexico that trigger significant violence across states dominated by the cartels, including violence targeting Americans directly.
Risk #2: U.S.-EU Ties Rupture Over Greenland, Trade Issues
U.S.-European ties fundamentally rupture over Greenland, NATO and trade issues, which Russia capitalizes on to increase pressure on Europe. The United States significantly increases pressure on Denmark and Greenland, aiming to acquire the latter. But after Denmark repeatedly rejects U.S. attempts to purchase the resource-rich island, Washington moves toward trying to seize the island, first by trying to buy off the support of Greenlanders with promised money and aid, and then through direct military intervention. The United States would likely use any Russian activity in the Arctic as a pretext to carry out an operation in Greenland and would likely face little military resistance from European military powers. This would severely undermine NATO, cause Denmark to withdraw from the alliance, and, in an extreme scenario, result in NATO's collapse.U.S.-EU tensions over technology and trade issues also boil over, which could occur with or without a crisis involving Greenland, with the United States and the European Union placing large tariffs and fees on each other's goods and companies. These events would fundamentally reshape the U.S. relationship with Europe and likely lead to many European powers viewing the United States as a revisionist power that, at least during the remainder of Trump's term, poses a significant threat to their economic and national security, comparable to that of China and Russia. The severed U.S.-Europe relationship, in turn, enables Russia to increase pressure on Europe through increased hybrid warfare activity and potentially even military action in the Baltics.
Risk #3: U.S. Trade Wars Reignite, Triggering Supply Chain Disruptions
The United States' new trade deals with China and the European Union fall apart, and Washington formally triggers and potentially even withdraws from its trade pact with Mexico and Canada. Stronger-than-expected U.S. economic growth and a desire to focus on trade and economic policy ahead of the 2026 midterm elections prompt the Trump administration to reignite its trade wars with the European Union and China over the former's digital policies and the latter's ongoing restrictions on rare earth exports, among other issues. The reimposition of higher U.S. tariffs on European and Chinese goods increases prices and likely prompts China to retaliate by further restricting exports of certain critical raw materials, particularly rare earths, to the United States. But this time, the United States and its trading partners fail to find a quick compromise that resolves U.S. concerns, resulting in supply chain disruptions that last far longer than those seen in 2025. Meanwhile, the review process for the United States-Mexico-Canada Agreement (USMCA) is contentious amid Washington's refusal to accept Mexico City and Ottawa's demand for continued free trade access to the U.S. market. As a result, the United States not only fails to agree to extend the pact, but also triggers the six-month withdrawal process from USMCA and imposes tariffs exceeding 25% on all goods from both countries. While the White House's move to trigger the exit process may be a negotiating tactic and the withdrawal may not occur until 2027, the decision still causes significant disruptions across North American supply chains as companies seek to rapidly reduce exposure to Mexico and Canada.
Risk #4: Middle East Crisis Reemerges
Renewed conflict between Israel and Iran breaks out and cannot be contained, threatening the continuity of the Islamic regime in Tehran. Israel launches another significant attack on Iran that aims to not only further degrade the country's nuclear, drone and missile capabilities, but also kill leaders of the Islamic Republic, including Supreme Leader Ali Khamenei. This leads to a series of back-and-forth strikes between Iran and Israel that lasts for many weeks, as well as a resumption of Iran-backed Houthi attacks on shipping in the Red Sea and Gulf of Aden. U.S. support — or even involvement — in the Israeli strikes also prompts Iran and its proxies in Iraq and elsewhere to periodically attack U.S. forces in the Gulf, as well as oil and gas infrastructure in countries hosting a major U.S. military presence, like the United Arab Emirates. Inside Iran, the renewed crisis with Israel, coupled with the mass anti-government protests, threatens to significantly transform or even collapse the regime — triggering what would likely be an extremely violent internal conflict, as members of the Islamic Revolutionary Guard Corps and other hard-liners seek to assume and/or maintain power. The breakdown in the chain of command would also raise the risk of a low or mid-level Iranian military officer ordering a more brazen attack abroad, which could target commercial infrastructure rather than strictly military sites.
Risk #5: China Blockades Taiwan
China implements a naval blockade of Taiwan's key ports, disrupting global shipping and rapidly accelerating Western supply chain decoupling. In this low-likelihood, high-impact scenario, China fulfills a partial or full blockade of Taiwan, driven by a combination of growing U.S. arms sales to Taiwan, Japanese diplomatic engagement with and indirect security pledges to Taiwan, and Taiwanese policies aimed at preventing cross-strait dialogue and countering Chinese influence. Initially, the blockade likely takes the form of a large-scale military drill around Taiwan (similar to the ones China has conducted several times since 2022), as Beijing attempts to coerce Taipei into disengaging from Western security partners and engaging in cross-strait political dialogue. The blockade then evolves into China's navy and coast guard implementing area denial operations for commercial vessels near at least Kaohsiung and Keelung ports and potentially at ports around the entire island for several days or even a couple of weeks, enough to disrupt commerce but not enough to drain Taiwan's fuel reserves and trigger power outages. This would severely disrupt key global shipping lanes and rapidly accelerate Western supply chain decoupling from China and Taiwan. It would also risk escalation to a kinetic conflict if Taiwanese forces, potentially assisted by U.S. forces, try to run the blockade.
Risk #6: Artificial Intelligence (AI) Bubble Bursts
The collapse of investor confidence in the near-term profitability of AI companies triggers a bubble burst in the sector, creating ripple effects throughout the industry's value chain that also slow U.S. economic growth. For several years now, AI companies have been promising that they will be able to turn a profit, despite negative cash flow (OpenAI, for example, does not expect to become profitable until at least 2029). But reports on AI's adoption and use across businesses continue to indicate that companies overpromise and underdeliver. This — coupled with the use of cheaper, smaller open-weight models for simple applications, such as text summarization — prompts investors to rapidly ditch AI stocks and companies like Nvidia that are part of the value chain. The sharp collapse in stock values for AI firms, data center operators and suppliers leads to significant industry consolidation, as well as anemic U.S. economic growth or even a recession. The significant losses faced by venture capitalists also dry up VC funding for other technology areas. While AI's revolutionary implications for the global economy will likely ensure its continued adoption, 2026 proves to be a turbulent and disruptive year for the industry.
Risk #7: Backlash Against AI Escalates
Backlash against AI intensifies, triggering regulations on the sector and flashpoints between labor groups, employers and the government. Rather than a bubble bursting, AI integration in business deepens significantly in 2026, with AI agents and agentic AI becoming ubiquitous in many industries. This, coupled with an increase in reported cases of AI abuse, leads to a regulatory crackdown and public outcry about the technology's rapid evolution — particularly in the United States, where AI regulations are lacking, and in Europe, where AI regulations are more lenient. Simultaneously, AI's impact on the workforce becomes both a major political issue in elections and a flashpoint between employers and employees, as layoffs and limited hiring connected to AI replacing white-collar jobs increase unemployment among college graduates. While some governments may increase social welfare benefits and back state-funded job retraining programs, this does little to ease workers' growing apprehension about how organizations are adopting AI.
Risk #8: Russian Hybrid Activity in Europe Intensifies
A prolonged diplomatic stalemate or a shift in the balance of power around Ukraine prompts Russia to escalate its hybrid campaign against Europe as a means of coercion, increasing the risk of an open conflict. Russia intensifies its hybrid campaign in Europe, emboldened by either stalled peace negotiations with Ukraine or the perception that the United States and the broader West are unwilling or unable to increase military and economic pressure against Moscow. This escalation could take the form of increased cyber intrusions against European critical infrastructure, government networks and defense-related industries, combined with intensified information operations aimed at exploiting social polarization, elections and public anxiety over security and economic pressures. It could also include acts of sabotage against energy and transport infrastructure, interference with undersea cables and pipelines, GPS jamming near borders and the use of proxies or deniable actors to conduct arson, intimidation or disruption operations. Additionally, Russia could leverage energy, migration routes and selective trade pressure to strain European unity, while pairing these actions with military signaling (such as snap exercises and airspace violations) to raise deterrence dilemmas without crossing the threshold of open conflict. This would increase the risk of accidents, miscalculation and an escalation of tensions with NATO, particularly in the Baltic and North Sea regions. While highly unlikely, a severe increase in U.S. military assistance for Ukraine could also result in an escalation of Russian operations against Europe, as Moscow could feel more desperate if it assesses that the tide is turning against it.
Risk #9: Youth Protests Gain Momentum Across the Developing World
Tepid economic conditions and limited political or social freedoms catalyze youth-led "Gen Z" protests across the Global South, toppling several governments and creating political crises. Widespread discontent fueled by high unemployment and poor living standards drives young people to stage large and frequent protests around the world — particularly in Africa, Southeast Asia and South Asia, where similar Gen Z demonstrations have had success in recent years. The success of initial movements then catalyzes protests in other countries, ultimately resulting in multiple governments being overthrown in revolutions or forced to resign for early elections before the end of the year. The global impact of these events will largely hinge on where they happen, but such youth-led unrest is possible in large, populous nations like Nigeria, as evidenced by previous Gen Z protests in Bangladesh and Indonesia. At a minimum, companies operating in affected countries could face significant supply chain disruptions as protests intensify, as well as policy changes aimed at appeasing protesters' populist demands, such as reviews of foreign investment in the mining sector.
Risk #10: India-Pakistan Cross-Border Strikes Re-Emerge
India-Pakistan tensions boil over into repeated strikes on each other, heightening personal safety threats in the two countries and disrupting regional travel and business operations. India and Pakistan engage in another round of clashes in 2026, fueled by ongoing high tensions and distrust after their brief May 2025 conflict. The clashes are again triggered by a provocation that one country links to the other, however tenuously — be it a militant attack or disruptions to water flows on the Indus River, which India and Pakistan have respectively warned would be seen as acts of war. The provocation, in turn, leads to kinetic retaliation that quickly devolves into renewed cross-border strikes. In such an event, companies and other organizations operating in Pakistan and India would face greater disruptions and safety risks, given that the 2025 conflict set a precedent for clashes to escalate more quickly to include targets even in major, densely populated cities. Renewed clashes would also very likely trigger an uptick in cyberattacks and potentially violent protests fueled by the surge in nationalist sentiment.
