War to break Iran risks handing it control over global energy chokepoints

• Conflict meant to dismantle Iran's nuclear ambitions and proxy network has instead fortified Iranian hardliners and strained Gulf allies' arsenals.
• Iran's resilience, leveraging underground facilities and asymmetric warfare, has led to surging domestic support for Supreme Leader Khamenei.
• Gulf states face urgent needs to rebuild depleted air defense inventories and enhance early warning capabilities, reassessing defense procurement.
• The conflict has created a "five straits" crisis, impacting global energy chokepoints like the Strait of Hormuz and Bab al-Mandab.
• Economic repercussions include crude prices doubling to $150/barrel, fueling inflation globally and straining oil-dependent Gulf economies.

Key Questions Answered

How will this conflict impact global oil prices long-term?

The conflict is projected to impose a permanent risk premium of at least $10 on oil prices, with potential ranges of $100-$150 or even $150-$200 per barrel in a worst-case scenario

Could Iran gain more regional power from this war?

Iran's regional power could increase due to the ongoing war.

What are the risks for countries dependent on Middle East oil?

Countries dependent on Middle East oil face risks of elevated prices, supply disruptions, and broader economic fallout due to ongoing conflicts and chokepoint vulnerabilities.