Iran isn't winning this war, but it might if the U.S. stops the bombing due to higher oil prices. The ayatollahs can't be allowed to conclude that shutting down oil flows is their passport to survival — now or in the future.
The Strategic Calculus
Iran's decision to threaten global oil flows by targeting tankers in the Strait of Hormuz and disrupting Gulf infrastructure is a calculated gamble: inflict enough economic pain on the West through energy markets to force a ceasefire that leaves the regime intact.
For this strategy to fail — decisively — the United States must demonstrate that military and economic pressure will continue regardless of short-term energy price spikes. Any indication that oil prices alone can halt U.S. operations would provide Tehran with a durable template for resisting future pressure.
Oil Market Dynamics
Brent crude briefly surged to its highest intraday level since 2022 before dropping approximately 9% to around $90 a barrel. Behind the slide: hopes that the world's biggest economies will release strategic oil reserves, and comments from President Trump signalling a limit to the duration of hostilities.
The S&P 500 was recently up less than 0.1%. Caterpillar added around 2.5%, helping boost the Dow Jones Industrial Average by 0.2%. Treasury yields edged lower. The dollar weakened. Gold rose around 2.6%.
The Economic Risk of Stopping
Paradoxically, a premature halt to operations that leaves Iran's regime intact and its oil-disruption capability unimpaired would create far greater long-term energy price risk than continuing until a durable resolution is achieved. The short-term pain of elevated oil prices is real — but the long-term cost of an emboldened Iran with a proven oil-price weapon is far greater.
