The Iran War: Winning, Losing And Ending

The war’s energy impact will outlast any cease-fire, shaping global politics and economics for years

By Anil Madan

Even as the ceasefire in the Iran war stretches out, there is the uneasy feeling that an agreement between the US and Iran is far, far, away and perhaps impossible to achieve. Meanwhile, for the Iranian people, for the Gulf States, and indeed for the world, the devastating effects are compounding. For the Iranian regime, even with the ceasefire in effect, they face an existential crisis. For Israel, the prospect of an Iranian nuclear arsenal is existential. In Lebanon, destruction continues and part of its territory has been invaded by Iran. For the US, this war has meant a significant depletion of munitions, a significant erosion of support from allies, and in some ways, for the Republicans, an existential threat in the upcoming midterm elections in November.

Pic – economictimes.indiatimes.com

It has been said that the Iranians are masters of not negotiating while seeming to negotiate. David Sanger of The New York Times wrote: “President Trump views himself as the master of coercive diplomacy, forcing his opponents to capitulate quickly to American demands or face the threat of attack. But in dealing with Iran over the past six weeks, Mr Trump has discovered that he is up against a nation that prides itself on resilience and delay.”

German Chancellor Friedrich Merz was less charitable. The “Americans clearly have no strategic plan,” he said. “Especially since the Iranians are negotiating very skillfully — or rather, very skillfully not negotiating. And then letting the Americans travel to Islamabad, only to send them back without any results. An entire nation is being humiliated by the Iranian leadership, especially by these so-called Revolutionary Guards.”

Both sides proudly declare that they are not negotiating, but their statements are a way of negotiating in the ether and communicating their views of a successful end to the war.

So, is there a winner? Is there a loser? The clearest answer is that ceasefire notwithstanding, the war has not formally ended and therefore, it is premature to declare a winner and a loser. Nevertheless, the adage that war leaves only losers, not winners, seems to be true this time too.

President Trump’s bottom line is that Iran will never have a nuclear weapon. He wants Iran to agree to stop enriching uranium and to give up its stockpile of enriched uranium. Iran insists that it has the right to enrich uranium and that it will not part with the stockpile.

In a post on his social media platform, referring to the deal that President Obama negotiated, President Trump posted: “The DEAL that we are making with Iran will be FAR BETTER than the JCPOA. It was a guaranteed Road to a Nuclear Weapon, which will not, and cannot, happen with the deal we’re working on.” If we measure the success of America’s negotiation by that standard, there is no victory. Yet. But note that Mr. Trump does convey the idea that he is working on a deal; in other words, negotiating.

Iran’s bottom line includes control of the Strait of Hormuz including the right to charge fees for transit of tankers, a guarantee that the US and Israel will not attack it again and postponing the issue of its nuclear enrichment activities to a later date. The first and third are non-starters for the US. It is not clear who can give Iran the guarantee it seeks, or why it would be willing to accept Israel’s and America’s word on the subject. After all, one of Iran’s laments is that the US and Israel are unreliable because they attacked it twice while ostensibly negotiating with the regime.

The Iranian people are clearly losers as Iran’s economy has imploded. The Gulf States are losers as their energy exports have dwindled, their energy infrastructure has been severely damaged by Iranian attacks, and the carefully built aura of safe and secure havens for investment and tourism has gone up in smoke.

The world’s economies teeter on the precipice of a cliff from which there seems to be no retreat. There are losers all around.

The principal strategic issue is control and future of the Strait of Hormuz which is now a global chokepoint carrying roughly a fifth of the world’s oil and LNG and its continued closure has become the central pressure point in the conflict.

Iran closed the strait and attacks ships that don’t pay or comply; the US responded with a naval blockade of Iranian ports, effectively weaponizing the same geography from the opposite direction. These dual coercive pressures have severely curtailed oil and LNG supplies and shut down trade in essential commodities transiting the strait to and from the Gulf region.

The result has been a collapse of ship traffic. Total ship transits fell to 35 last week, down from 78 the week before and down from about 130 per day before the war.

Iran wants to retain control and even charge transit fees; the US insists on full freedom of navigation and rejects any “Suez Canal–style” arrangement. There is no negotiating room between these extremes. One possibility is a regional authority run jointly by Iran and the Gulf States with revenue to be used for reconstruction of the damage in Iran and the Gulf States. If this includes funds for repairs to American bases damaged by Iran, US agreement is more likely.

The second important strategic issue from the US perspective is blockade, pressure, and coalition-building. Trump has chosen an extended blockade over renewed bombing or withdrawal, judging it the least risky path that still preserves leverage. He has called the blockade “genius” and “100% foolproof,” and believes it is pushing Iran toward a “State of Collapse.” Trump said he was willing to maintain the blockade and continue the war ‘unless they agree that there will be no nuclear weapon.’”

The latest US initiative is a proposed Maritime Freedom Construct, a US led coalition to share information, coordinate diplomatically, and enforce sanctions. A US State Department cable appealing to prospective participant nations, says: “Your participation will strengthen our collective ability to restore freedom of navigation and protect the global economy. Collective action is essential to demonstrate unified resolve and impose meaningful costs on Iranian obstruction of transit through the Strait.”

This new overture conflicts with Trump’s earlier positions that the Europeans should go get their own oil and even take the strait, and also his subsequent position that American would go it alone. Viewed in its best light, it is a recognition of the importance of the strait to the rest of the world.

The third strategic issue revolves around Iran’s economic crisis and political resilience. Iran has suffered major economic damage. The war has thrown one million, and perhaps as many as two million people directly and another one million indirectly out of work. Some economists suggest that Iran could lose millions of additional jobs. Inflation has reportedly hit 67%; bombing has caused an estimated $270 billion in reconstruction needs, nearly the size of Iran’s annual GDP. One positive note here is that if Iran can sell oil to China, it could be paid in Yuan and use the proceeds for contracts with Chinese companies to rebuild the country.

One measure of how serious the situation in Iran has become is that the deeply unpopular government has appealed to Iranians to do their part by limiting their consumption of water, electricity and gas. Tehran residents were encouraged to drive less and use public transportation instead.

The political calculus is intriguing. Iran’s leadership frames resistance as national pride and believes it can absorb hardship longer than the US can tolerate high energy prices and global economic risk. But the same economic pressures that fuelled prewar protests are intensifying, raising the risk of renewed unrest once the immediate war pressure eases.

The fourth strategic issue revolves around the stalled peace talks and the nuclear/strait sequencing problem

The core disagreement is framed as follows:

* Iran wants:
– End of the war
– Lifting of the US blockade
– Control or co-management of the strait
– Nuclear talks postponed to a later phase

* The US wants:
– Nuclear concessions (e.g., long-term suspension of enrichment) embedded in any framework
– Freedom of navigation in the strait without Iranian veto or fees
– Iran stops funding and arming its proxies

The talks are failing because the Trump administration sees Iran’s sequencing — first end the war and blockade, then talk nuclear — as stripping away US leverage. Iran sees US demands as “maximalist” and refuses to concede on the nuclear file while under blockade.

The fifth strategic issue concerns global energy disruption and long-term damage to oil capacity.

The immediate shock effects are seen in the soaring price of oil. The Brent crude spot price has surged to just under $120 per barrel. Traffic in and out of the Gulf is “close to a standstill,” and the closure is lasting longer than initially expected.

The long-term damage to oil wells and infrastructure cannot be overstated. Shutting down thousands of wells quickly has damaged infrastructure and will slow any restart. For example, in neighbouring Iraq, production fell from 4.9 million barrels/day to 1.6 million, and some fields may never fully recover. Damage to wells will have to be repaired and equipment such as submersible pumps make have to be replaced to bring production back. Even if the strait reopened tomorrow, analysts expect months or years before Gulf production returns to prewar levels.

This means the war’s energy impact will outlast any cease-fire, shaping global politics and economics for years.

The sixth strategic issue concerns US military strain and political costs. The US has expended large stocks of precision munitions and air defenses, forcing redeployments from other theaters (like Asia) to the Middle East. This weakens deterrence elsewhere and raises questions about sustainability if the conflict drags on.

On the domestic political stage in the US, the blockade and war have driven up gas prices and hurt Trump’s poll numbers, darkening Republican prospects in the midterms. Business leaders close to Trump worry that a prolonged energy shock could be a “political death knell.”

Trump is caught between hawks urging continued pressure and businessmen and political advisors focusing on economic and political realities pushing toward de-escalation.

Mauritius Times ePaper Friday 1 May 2026