The Daily Brief

The ongoing conflict between the US and Iran has deep historical roots, stemming from decades of geopolitical tension. The 1979 Iranian Revolution, which saw the overthrow of the US-backed Shah, marked a significant turning point in US-Iran relations. Since then, Iran has been viewed with suspicion by the US, particularly due to its nuclear ambitions and support for groups considered hostile to US interests in the region, such as Hezbollah and various militia groups in Iraq. The US's withdrawal from the Joint Comprehensive Plan of Action (JCPOA) in 2018 under President Trump further escalated tensions, leading to a series of confrontations, including drone strikes and cyberattacks. The assassination of Iranian General Qassem Soleimani in January 2020 by a US drone strike exemplified the high-stakes nature of this rivalry, setting the stage for the current military escalation. The implications of the current conflict are profound, not only for Iran and the US but also for the broader Middle East and global markets. The humanitarian crisis is already unfolding, with over 100,000 people displaced from Tehran in just the first two days of strikes, as reported by the United Nations. This mass exodus could lead to significant strain on neighbouring countries, particularly Iraq and Turkey, which may already be grappling with their own internal challenges. Furthermore, the conflict threatens to destabilise the entire region, as various state and non-state actors may seize the opportunity to assert their influence amid the chaos. Economically, the potential for rising energy prices looms large, as fears of wider regional instability could disrupt oil supplies, reminiscent of the 1973 oil crisis when geopolitical tensions led to significant price hikes. Key players in this conflict include the US and Israel, who have aligned their military strategies against Iran, viewing it as a common adversary.