The court on Tuesday ruled in favour of US ally Philippines in its dispute with China over its claims in the South China Sea. The tribunal also ruled overwhelmingly against Chinese claims to huge swaths of the strategically important waterway.

“It will have a significant long-term impact on US-China relations. Mutual distrust and suspicion will deepen and continue to grow,” said Zhu Zhiqun, the director of the China Institute at Bucknell University in Pennsylvania.

Zhu noted that the US decision just days earlier to deploy a missile defence shield in South Korea, a move Beijing has strongly objected to, adds to the growing suspicion and distrust between Washington and Beijing.

Miles Yu, a professor of East Asian military and naval history at the United States Naval Academy, said both nations would increase their military presence in the region as evidenced “by the huff and puff of the military bravado” displayed by the People’s Liberation Army in the South China Sea on the eve of the tribunal ruling.

“However, it is unlikely that the US and China will go into a general war, which China knows it cannot win,” Yu said.

Analysts say the South China Sea dispute highlights a growing gulf between the two nations and also between China and its smaller neighbours, as the two superpowers jostle for influence in the region.

President Xi Jinping and Barack Obama have managed to cooperate on global issues such as climate change during their terms in office, but tensions have escalated in the past year over China’s increasingly assertive claims in the South China Sea.

Some analysts said this week’s ruling was likely to even further complicate the already difficult relationship between Washington and Beijing.

The first question is what action China will take in response to the humiliating court ruling.

This could include declaring an air-defence identification zone over the South China Sea. This would require foreign flights to identify themselves to China before entering the airspace. China announced a similar zone in the East China Sea in 2013.

Liu Zhenmin, China’s vice-foreign minister, has already said Beijing reserves the right to declare an air defence identification zone over the South China Sea.

Beijing could also shows its defiance over the ruling by increasing its programme of reclamation work expanding reefs and small islands in areas it claims in the disputed waters.

Benjamin Herscovitch, a research manager at China Policy, a Beijing-based policy analysis and advisory firm, said China was unlikely to immediately declare an air identification zone, or ADIZ, in the area in the wake of the ruling.

“Although a Chinese declaration of an ADIZ over the South China Sea is in the offing in the coming years, Beijing is likely to judge that such a declaration would be overly provocative given China’s recent rejection of the ruling,” he said.

However, China might seek to demonstrate its rejection of the ruling by starting island reclamation work in the Scarborough Shoal in the South China Sea, he said.

“Beijing has already indicated its interest in such island construction and now would arguably be a fortuitous moment to initiate such construction,” Herscovitch said.

Another question is what actions the US will take in the light of the tribunal ruling.

President Obama has said he would hold China to account if Beijing chose to go against international law and norms.

Washington has regularly sent warships, including aircraft carriers, to patrol in the South China Sea in recent months. The US also has an obligation to protect the Philippines as part of a mutual defence pact between Manila and Washington.

Analysts said the ruling would probably embolden the US to continue or even step up its naval patrols in the area.

“The US is likely to maintain its robust military presence in the South China Sea for a while to stabilise the situation from its perspective,” said Zhu at Bucknell University. Washington will also encourage claimants, especially China and the Philippines, to settle disputes peacefully, he said.

“The US will pressure China to abide by international law and respect the tribunal’s ruling,” Zhu said.

China’s rejection of the court ruling is also likely to lead to heightened Sino-US tensions over American freedom of navigation operations (FONOPs) in the area, according to Herscovitch.

“An uptick of US FONOPs within 12 nautical miles of Chinese-controlled features like Mischief Reef and Subi Reef is therefore to be expected, he said.

Chinese maritime law enforcement vessels might tail US naval vessels and perhaps even seek to block their entry into sensitive waterways, he said.

John Ciorciari, a China expert at the Ford School of Public Policy a the University of Michigan, said the danger of backing China further into a legal and diplomatic corner was that it may rely on military power and other coercive measures if other strategies fail. He noted that Chinese leaders have taken an uncompromising public stand on the court ruling that limits their ability and willingness to back down.

However, Ciorciari said that both Beijing and Washington have no appetite to allow events to spiral out of control.

“China will not accept the PCA ruling as legitimate, but it does have an interest in avoiding moves that would provoke additional balancing behaviour from neighbouring Asian states,” Ciorciari said.

“Neither side wants this issue to dominate and poison the complex Sino-U.S. relationship,” he said.

Andrew Mertha, a Cornell University China affairs expert, said the ruling further isolates China internationally . Beijing may also have painted itself into a corner at home with its nationalist rhetoric over the South China Sea dispute, he added.

“We should expect an outpouring of nationalist sentiment that will result in China’s further isolation from, rather than engagement with, the international system,” Mertha said.

Some analysts worry that US presidential election politics may also add oil to the fire.

Both US presidential candidates, the Democratic Party’s Hillary Clinton and Republican Donald Trump, have called on all parties to abide by the international court’s ruling. Clinton said she welcomes the ruling, adding that the South China Sea’s waters were critical to the US economy.

An adviser to Trump said countries involved in the South China Sea dispute should respect the court’s ruling and that China had no historic title over the waters.

Yu at the United States Naval Academy said Clinton was likely to be tougher towards China than Trump, but the Republican’s stance may harden if it is perceived that America’s global strategic position was threatened by China in the South China Sea.

Jessica Chen Weiss, professor of government at Cornell University, said that in the aftermath of the ruling, the US and its allies should not make political capital from China’s defeat.

“The more we trumpet China’s defeat or loss of face, the more domestic pressure the government will feel to respond with more than bluster,” she said.

Zhu at the China Institute at Bucknell University said that in the long term the US and China will have to work out a deal to “accommodate two tigers on the same mountain”.

“If they fail, expect more conflicts and stormy days ahead in the relationship,” he said.