Shimon Peres won at Nobel prize for forging a treaty between Israel and Palestine. He's known as "Israel's warrior for peace" and has been a long time force in and influence on Israeli government. His passing leaves a vacuum and silences a voice for peace, so it's likely there will be greater tensions between Israel and Palestine.
When it comes to Israel and Palestine, any reason that can fuel conflict, will. Tension is so generally high on a day to day basis that people are on edge and angry and any thing can be that "straw that breaks the camel's back", so to speak. The emotions tied in to the lost of such a historic figure will only make these feelings stronger.
New tensions will likely rise between Israel and Palestine, because the Palestinians will try to test the Israelis. Peres was a strong leader for Israel. The Palestinians will probably try to provoke some sort of fight during this time of national mourning in Israel. Therefore, the Israelis should be on guard for any attacks.
Yes, he was a great figure of the country. The history has shown that whenever some great politician dies, some other politicians, who were his opponents, use the situation in their own benefit. So, now we can expect some turbulence. He was an icon of peace and peaceful politics and now he is dead.