IRAN WAR - STUCK BEHIND THE TIGER'S TAIL?

 The Big Bang

The Iran war started with a bang, in fact, a series of big bangs. Unlike the big bang that is said to have started the universe, the bangs from the 30-odd bombs dropped over multiple locations in Tehran were meant to create a new world order. The precision-guided air-launched ballistic missiles that first climbed into their sub-orbital trajectory in the “near space” and darted down at extremely high speeds onto the secure compound where Ayatollah Khamenei lived. It was Operation Epic Fury, unveiled. Immediately thereafter, Prime Minister Benjamin Nethenyahu and President Trump declared that the ‘evil regime’ has been decapitated. 

This was on 28 Feb 2026. 

The world waited to see the high-speed evolution where the Iranians took to the streets in multitudes, overturned the regime, chased the mullahs out, and installed someone Uncle Sam, the benevolent and righteous, liked. After all, the Iranians under a repressive regime deserved redemption. All sorts of experts declared that Iran would fold up in a matter of a few days, if not hours. Nothing of that sort happened. Epic fury is still about sound and fury, with no significant move forward in evolution.

Today is 21 Mar 2026. 

Endlessly Furious

It has been twenty-one days into the war, after a superpower and an aspiring superpower unleashed their ‘epic fury’ and rained bombs on an already severely degraded adversary.  Asymmetrical warfare is holding down the mighty. Everyone knows what Iran has lost in the war, but no one knows anything about the other side. It is illegal to publish it, I am told.

But there is enough spectacle. One can see the most powerful man on earth, the President of America, claiming that he is winning the war that he had already won, not just once but twice. In the first week of March 2026, he destroyed Iran’s nuclear assets, which he had already obliterated in June 2025. And, he is still trying to destroy their nuclear capabilities. You can also hear him shout out to his allies, asking for help to win the war, which he already won. He then tells them he does not need any more help because they refuse to give it to him. Yesterday, he even called them cowards for not joining the fight that he had already won. The war continues.

He is mad at the Iranians, who refuse to be freed from an evil regime that doesn't exist anymore. He is not ready to stop the war because he is not happy with the offer he says Iran has made. Iran refuses to stop the war unless America makes good the losses. Who on earth can be happy paying reparations?

Operation Epic Fury has brought America, Israel and the Gulf states into a situation like the one holding the Tiger’s tail. That is an interesting old Malayalam folk tale. We will keep it for the end. 

Fury To Whose Benefit?

The war is being fought by one country against two, supported and wished away at the same time by the others in the Middle East. The war has now come to a stage of targeting oil production facilities. Israel bombed Iran’s gas fields. America says it did not know. Iran, in turn, set ablaze Qatar's fields and told everyone that they did it. Iran set fire to Israel's refinery, too. Everyone is condemning Iran for retaliating as if it is illegal for a country to retaliate against aggression. The impact of the war is not confined to the region. The war is fast spinning out of control and has serious implications for the whole world.

Who is benefiting from this war? The natural corollary to the question is, “Who stands to lose from this war?”  

We will start with those directly involved. We shall consider each player and look at their gains and losses. We will start with Iran.

After all, according to America, Iran was the cause of the war.

Iran 

Down and suffering over 20 years of sanctions imposed by America, they had nothing on the balance sheet other than the means to survive. Iran’s balance sheet is materially in the red, and for a long time. Brought to war despite their best efforts to prevent it, and having lost a string of senior functionaries in the war, survival as a country will be the biggest success they can attain. Each drone or missile that flies out is only a desperate means to survive. Loss is what they have. They have nothing to lose other than dignity.

Benefits?

The world now sees Iran in a different light. It is the only country in the world standing up to a bully, cost be damned. They have declared that they will stop only when their conditions are met. So, if the war ends at their terms, it will be a big political and economic victory. It will roll out the structure of a new world order. That is possible only if Iran can wear out their adversaries.

America

A Dream Gone Sour

The dream of running over Iran, the last standing obstacle to American supremacy in the Middle East, in a few days to effect regime change, installing a power structure that will dance to American tunes, has certainly not worked. At least in the time frame they had calculated. The Iranian command and control structure was decapitated on the first day. Whenever a new head is announced, Israel goes headhunting. 

Yet, Iran continues to fight. Iranians say they fight not with the body but with their souls. In military terms, the USA has demonstrated to the world that they have mapped Iran, to the last inch, last man. Despite uncontested aerial supremacy and the type of missiles and arsenals under command that rain fire, and all the repeated assertions that the war has been won, a comprehensive victory, convincing enough, still seems far away. 

Anything America thought was inimical was bombed to dust. That also included a school. In these endless bombing runs, America also irrevocably obliterated the relevance of the United Nations once and forever. They have thrown the international code of conduct to the winds. It has also set a precedent, a dangerous one, for others with the stomach for such violence.

Reinforcing Failure

One of the most common mistakes militaries across the world make is to reinforce defeats. This comes from the inability and reluctance to accept the truth that a plan has gone awry. Stepping back is considered a defeat. Therefore, those in charge continue to commit combat resources even when returns are dismal. It took a long time for America to realise it in Vietnam and in Afghanistan. Iran may not be a different arena.  Despite mounting losses and may be few unbelievable ones, America, in all likelihood, could commit more naval and air resources to this war. It will not be surprising to see American boots on the ground. Egged on by Prime Minister Benhamin Nethanyhu, President Trump could do that too.

Results be damned.

Geopolitical Status 

A quick victory over Iran would have certainly cemented America's place in the global geopolitical space. But the war in Iran seems to have done just the opposite. If the USA aimed to weaken Iran, contain it militarily, and politically, then it has not yet succeeded. The American military could be deadly, but Iran has shown the world that American might can be suffered and contested. The lessons of the Vietnam War have been refreshed. 

America’s inability to prevent a war and the consequences of the war it started have eroded America’s status as the primary security guarantor for Gulf Countries. The investment in security made by the kingdoms and sheikdoms has proved to be ineffective. Would they seek other means to secure themselves? Can such a possibility be ruled out? If it happens, that could be the beginning of the end of the USA as a global power.

The war has shaken up the relationship between the US and its allies. Spain has condemned the war as a “serious mistake” and “a unilateral military action and violation of international law.” It has not allowed the US forces to use Spanish bases for the war.  The UK, once the strongest and most unquestioning supporter, Germany and France have also refused to join the war, although they condemned retaliation by Iran. Never in history has the USA been so isolated in its military quest as NATO stands fractured. Trump has called them cowards! Europe, slighted by Trump, is seeking strategic autonomy. If all that was not enough, President Trump has left no opportunity to ridicule the heads of state visiting the US. US diplomacy seems to have thrown the book of decency into the dustbin. The current war has accelerated the degradation of American foreign policy. 

The USA has committed heavily to sustaining Ukraine against Russia.  It is embroiled in Venezuela and wants to walk into Cuba. The war in Iran has severely dented the image of its Navy, if not the carrier fleet and the stealth fighters. In a way, the weight and reach of the American military, spread all over with its assets depleting, could diminish its efficacy in countering China and Russia.

The USA, under President Trump’s “America First " policy, decided to exit from 66 International organisations, conventions, and treaties. The attack on Iran while negotiations were in progress confirmed that the USA can take unilateral decisions in violation of all internationally accepted norms. The USA is working hard, like never before in history, to undermine its own position.

Oil Revenues 

The increase in crude oil prices can help the American oil producers and companies operating in the Gulf make a killing, provided they can take it out of that place. Iran has threatened to target these assets located anywhere in the Middle East. The US, however, has a huge reservoir of shale gas, which it has been exporting as LNG to Europe and Asia.  GAIL(India) is a major buyer of US shale gas. Uncertainty in Gulf crude supply could help the USA earn higher revenues for its shale gas. They could leverage it as a strategic asset in geopolitical bargains.

Petro Dollar

The petro dollar could remain in place for some time, but the probability of an alternative mechanism emerging soon cannot be ruled out. Unfortunately for America, more and more countries might be forced to think beyond the dollar and in the Gulf region beyond the petrodollar. The Yuan, Ruble, and Euros could gradually replace the dollar. 

There are enough indicators to show that China would settle oil trade in Yuan. Iran had already made a statement that containers settling purchase in Yuan will be given free passage through the Hormuz. These are early days. A bilateral currency agreement with trade surpluses adjusted in a third currency cannot be ruled out. The dollar, in an unpredictably temperamental pair of hands, is no longer the most trusted currency. If the excursion to cement the global leadership position does not yield results soon, it could effectively weaken the dollar and even lead to petrodollar atrophy. If that happens, it could spell disaster for the American economy. However, expect the USA to do everything possible to extend the relevance and inevitability of the dollar in global financial systems. That could trigger many a confrontation in future.

Arms Sales

The US arms industry will certainly stand to gain. With shelves emptied out of munitions meeting the expiry dates, there will certainly be demand for more. Moreover, a lot of their strategic reserves would have been consumed and need to be restored. Replenishment means money for the industry. Companies like Lockheed Martin, Raytheon Technologies, and Northrop Grumman can look forward to hefty orders. Post-war refit of the fatigued fleet is another windfall waiting in the wings for US firms.

The USA is looking at a mixed bag, post-war.

Israel

Seeding Wars

Israel has publicly stated that it is committed to eradicating its existential threats. Its actions against Hamas in Gaza and Hezbollah in Lebanon are in line with this aim. The military action, ruthless and relentless, continues to take out individuals Israel considers vital to these organisations.  Collateral Damage is of no concern to them. However, these organisations have not yet been eradicated.  Of all the reasons that emerge and keep coming up, depending on who says, to whom and where, one reason for the Iran war is that Iran stands accused of funding and supporting Hamas, Hezbollah and Houthis, besides plotting to attack the USA and hoarding nuclear assets. 

If we see the progress of the war as of this date, decimation of Iran as a country and eradication of the organisations Israel considers a threat will take much more time than what Israel had initially calculated. 

If the Iran war goes in favour of Israel, in a short time frame, the likelihood of another country or organisation in the region being labelled as the new existential threat by Israel cannot be ruled out. With America playing host to Israel’s demands, creating a new enemy is not difficult.

There is also a school of thought that believes that all Israeli policies and actions are driven by its desire to become the sole regional power in the Middle East and thereby exercising control over the world economy. There is nothing to suggest to the contrary. Internationally, most countries have started distancing themselves from Israel’s policies.

Elusive Peace

Israel might degrade Iran’s military capabilities, but that will eventually be built back with even more fierce asymmetry built in. Israel’s existential threat will continue for as long as we can see. Extrapolating the current flow of events and positions taken by various parties, peace seems to be an elusive destination for Israel. A war can delay the next war, but cannot win peace. 

Bonanza Over the Horizon

The rate of expenditure of munitions in war is far greater than the rate at which they are manufactured and replenished. Iran’s dime-a-dozen drones and a few missiles have elicited a price from Israel. The ultra-costly anti-missile systems have been at work for some time and are fast depleting in stock. More and more Iranian missiles, even if fired in fewer numbers than before at a time, could get past the fail-safe Iron Dome.

With news going out of Israel heavily censored, nobody knows the extent of infrastructure damage within Israel. But it is a fair guess that Israel has suffered considerable infrastructure damage. Rebuilding Israel will be costly. The capital will have to come from Israel itself unless America decides to underwrite the losses or forces the GCC to cough up the moolah. Irrespective of who pays, those involved in rebuilding can look forward to making gains. Recouping the arsenal will be another major economic activity.

Surge in Orderbooks

The defence industry in Israel will stand to gain during and after the war, and so will those involved in rebuilding. Although the Iron Dome is no longer an impenetrable defence, it may still retain its commercial value. It is believed that the order books have found a surge with demand for an integrated system comprising the Iron Dome, Arrow and David’s Sling. The War provided Israel a chance for a live demonstration.

I do not foresee any change in Israel’s policies for some time. Therefore, despite whatever they may gain militarily, the balance sheet shall be negative in terms of peace. If the absence of peace is politically more rewarding than peace, isn’t war more beneficial?

The Gulf Region

No country in the Middle East has any profits to book in this war. Individually, it is a loss; collectively, it is a loss, and losses are compounding on a daily basis. Yet, it is intriguing to see how the war is shaping up.

The USA and Israel have used both land and air space belonging to these countries to attack Iran. Iran retaliated by attacking American military bases and destroying most of the radar systems located in the Gulf region. In the process, many Iranian missiles were knocked out of the sky, but the debris had to fall down. And that set fire here and there. The host countries did not like it.

The US attacked an Iranian bank and destroyed it. Iran called American commercial interests in the region legitimate targets and launched their missiles. Many of them were knocked out, but some found their targets. All countries hosting US interests will continue to receive missiles at different intervals and with different payloads. Dubai seems to be the most favoured destination for these Iranian payloads. 

Israel bombed Iran’s South Pars gas field on 18 March 2026. It is one of the largest in the world and supplies 80% of Iran's domestic needs. President Trump categorically stated that the USA has nothing to do with it, but no one believes it. Iran struck back on 19 Mar 2026, setting the Ras Laffan LNG complex on fire. This facility incidentally services 20% of the world's LNG requirements.

Iran also hit the Mina Al-Ahamadi refinery and the Mina Abdullah refinery in Kuwait. Iran also targeted the Habshan gas facility and the Bab oil field of the UAE.  While it may serve Israel’s purposes to get the Arabs and Iranians to fight amongst themselves, oil prices are likely to shoot up. It has already crossed $110 a barrel. Where it is headed is anybody’s guess.  

Iran’s foreign minister had claimed that the USA hit a desalination plant in Qeshm Island. There was also a report of a desalination plant in Bahrain being hit. Iran denied hitting it. However, destruction of desalination facilities, in a tit for tat, in the region cannot be ruled out. If it happens, it can wreak havoc in the region. 

The water war can have unseen consequences, especially for India.

Security Investments 

Most countries in the region had outsourced their security to the US and paid up for the service. Now, they find themselves targeted for hosting the very same facilities purported to be safeguarding them. In terms of investment, it turns out to be a bad investment, at least for now. 

Suddenly, the countries in the region have to come to terms with the fact that the security guarantor they had engaged not only failed to provide any security, but on the other hand, the security guarantor itself had initiated the security breach. Who will pay for the missiles fired? Who will pay for replenishing the stocks? If the Gulf countries pay up, which eventually they will be forced to, the US would have earned a profit too.

These countries would also be dealing with a difficult question. Should they allow the US to rebuild their military bases in their countries to continue with the security umbrella?  Obviously, rebuilding the billion-dollar early warning systems that existed before 28 February will be far more elaborate and therefore will be far costlier than before. Losses apart, a huge expense awaits them.

Any option?

If, for some strange reason, can they decide to ask the USA to leave? Will the USA leave just because they are asked to? For the Sheikhs and Kings, is it a Hobson's choice?  

Will the Arab Brotherhood bury its hatchet and come together?

Will the USA allow that? Will Israel allow the USA to permit it to happen?

Are we looking at a new power structure developing in the region?  These are interesting questions with deadly answers.

Oil Revenues 

The masters of the vast oil reserves of the Gulf certainly have not benefited, at least in the short term. Higher oil prices do mean higher revenues, unless sufficient quantity can be shipped out. No one in the Middle East stands to benefit, at least till the war ends. Loss of revenue, despite price rise, is what is immediately seen on the cards. Destruction of oil wells and gas fields has commenced in earnest, and this will have a catastrophic impact, both short-term and long-term, on the oil-producing countries. 

President Trump has called for navies from across the globe to keep the strait open. He has even requested China and Japan. Will they oblige? 

China - Myth versus Reality

Myth 

One set of strategic experts believes that the war would impact China more than any other country. They even go to the extent of saying this is the American means to checkmate China's growing influence in the region. In the initial phases, I also thought it could be the primary byproduct. Maybe it was. There are reasons, too.

The economic engine of China is driven by the oil imports from the Gulf region. China is the world's largest crude oil importer, and is said to import about 10 to 11 million barrels per day from various sources. Almost 50% of this (that is, 5 to 5.5 million barrels per day) comes from the Middle East. China imports from Saudi Arabia, Iraq, Kuwait, Iran and LNG from Qatar.  About 45 to 50% of China’s crude imports come through the Strait of Hormuz. China is the largest recipient of Hormuz oil flows, and accounts for about 37.7% of all oil passing through the strait. Choking Hormuz is like degrading China’s industrial activities. It is only fair to consider that the situation in the Gulf would undermine China's economic activities.

But, is it so straight and simple an equation? 

Reality

China is said to have approximately 900 million barrels stored as reserves. That is about 90 days of total import and about 180 days equivalent of import from the Gulf. China is not in shock. There is proof. It was confirmed that at least seven Russian crude oil tankers originally bound for China were diverted to India. While India may be ramping up purchases, under temporary sanction relaxations granted by friend President Trump, China had to be willing to give up that volume. Details of the transactions have not emerged. But it can safely be assumed that the diversion came with a premium paid certainly to Russia and may be to China, too. If China were in an oil shock, not one tanker would have headed to India.

One cannot expect China to be a silent spectator for long, waiting for the noose to tighten. China significantly increased its import of Russian oil. Before the Iran war, they were importing 1.8 million bpd.  It is said that they have doubled the quantum in March 2026. It is believed that they have locked in future shipments from Russia. India’s loss in Russia has been to China’s gain.

Some experts believe that the bombing of Kharg Island is a prelude to the US taking control of the island and its operation, and thereby restricting crude to China.  This is not impossible, for nothing is impossible.  How practical it would be remains to be seen.

Balance Sheet China

China is likely to benefit from the Chaos in the Gulf and the loss of credibility the US has inflicted on itself.  China remains the biggest trading partner for most countries in the Gulf and has remained visibly clear of politics while quietly investing in infrastructure. All six GCC countries (Saudi Arabia, UAE, Qatar, Kuwait, Oman, Bahrain) are either formal signatories or active partners in the Belt and Road Initiative. Interestingly, China maintains a very close relationship with all the Gulf Monarchies and also Iran. This places them in a unique sweet spot. If a successful mediation to end the war happens, it could come through China.

Post-war, too, China will continue to be the largest importer from the Gulf and therefore remain the biggest money bag for the kingdoms in the Gulf. It is likely to garner a huge chunk of the post-war rebuilding allocations. It is likely to exploit the hara-kiri USA has committed. It will be interesting to watch how China manoeuvres itself through this crisis.

Russia 

No one is clear about the extent of assistance Russia is providing Iran in this war. But there is a belief that Russia is providing Iran with intelligence and even hardware for the resistance. The downing of the stealth fighters is also attributed to Russian assistance.

Russia has been the single most beneficiary of the war, and the least of the costs. The immediate benefit flows directly to Russia, which is now selling oil at a premium to those who want it.  External pressure on Russia in the war against Ukraine has also weakened. Nobody, not even Trump, is talking of Ukraine and its need to be delivered from Russian clutches. It is a situation given on the plate to Russia. 

India

India has a different set of matrices to handle. Let that remain for the next article.

The Story 

Characters in the story have no resemblance to any individual or any entity.

There is an idiom in Malayalam, “ xxxxx Pidicaha Pulivalu.” It means, “Like the xxxx who caught the tiger’s tail”.  

There is a story behind it, and the characters are known by their caste.  Since anybody can take offence at anything nowadays, I take the liberty of modifying the names in the story, but not anything else. 

Once upon a time, there was a rich and smart man who was travelling from one place to another and had to pass through a jungle. In those days, people walked from place to place. The man had gold coins with him, which he kept in the fold of his dhoti. 

Somewhere in the middle of the jungle, there was a big tree. There was a cunning tiger in the jungle. He knew this was the route taken by travellers. It was the place he could get an easy meal.  That day, he was hungry and came and pretended to sleep under the tree.

When the man reached near the tree, he saw the tiger sleeping under it. The tiger jumped and tried to catch our hero.  Our hero dodged and ran around the tree because he knew that the tiger would easily outrun him.  The tiger started chasing the man around the tree. They ran after each other: the man in front, and the tiger behind.

Suddenly, our hero had an idea.

At the most opportune moment, he caught the tiger's tail. Now he could control the speed of the tiger, and they continued going around the tree. Unfortunately, in this melee, our hero's dhoti became loose, and the gold coins started falling to the ground one by one.

Now our hero could not let the tiger go, and the tiger would not let the hero go. The gold coins were all strewn around.

It was at this time that another traveller came to that place. He was surprised to see a man running after the tiger with the tail in his hand.  The man asked our hero, “What are you doing?”

“Can't you see?  You pull the tiger’s tail hard, and it will poop gold,” He replied.

Greed hath no creed. “Can you please give me a chance?”  begged the man.

“Sure. Why not? I have got as much as I wanted. Now you can take my place. After all, we are all human beings, and it is my honour to help you,” said our hero.

Soon, the tiger's tail was handed over to the eager man. Our hero retrieved whatever he could and fled for his life. 

It took some time for the man to realise that the tiger does not poop gold anymore. 

The story could have had only one ending.

It has nothing to do with the war in Iran