Iran-Israel conflict has entered Day 5. Israel has hit Iran’s nuclear facilities, missile sites, oil facilities, military & IRGC commanders & state-run news agency. Israel enjoys operational dominance in skies over Iran.
Iran launched hundreds of missiles & drones at Tel Aviv, Jerusalem & Haifa. 24 Israelis & >230 Iranians have been killed & many more injured. Residents are leaving Tehran, city of 10 million, choking roads; panic buying is worsening gas supply.
Iran, Iraq, Israel, Jordan & Syrian airspace are closed. Carriers are cancelling or rerouting flights. Oil prices spiked, gold rallied, indices & airline stocks dropped. Countries have issued travel advisories. The war is exacerbating economic crisis in Iran – inflation >40% & rial is collapsing.
Trump left G-7 summit in Canada early. G-7 leaders have called for an early resolution of Iranian crisis & broader de-escalation of hostilities in Middle East, incl a ceasefire in Gaza. Foreign ministers of 20 Arab & Muslim countries denounced Israel’s attack on Iran & called for de-escalation.
Israel’s Goals: Netanyahu wants to destroy Iran’s nuclear program. Israel has damages Iranian nuclear facilities, but will require US help to strike underground ones like Fordow. He may want regime change, but that will be upto Iranians. Ayatollah Ali Khamenei or any other political leader has not been targeted. Any attack could martyr them & rally Iranians round the flag.
Iran’s Options: Regime preservation would be a key goal. Tehran’s capacity for striking Israel is limited to its 2,000 missiles, >20% have been used up; 95%+ intercepted. Iran would not like US to get involved – has not targeted its assets, nor blocked Strait of Hormuz, which can spike global oil prices.
What Trump Wants? Get a weakened Iran to negotiating table, give up nuclear enrichment & allow international inspections. US has not participated directly but continues to share intel & protect Israel from Iran’s missiles. Trump campaigned promising to end wars. US participation would be bad news for Iran; US staying on sidelines means war would continue.
Will Negotiations Succeed? Unlikely; Iranian regime may not be willing to give up nuclear program – a core pillar of its legitimacy.
Scenarios: Businesses should prepare for:
- Escalation
- Blockage of Strait of Hormuz &/or Red Sea, attack on ports, travel & supply chain woes
- Accidental radiological event
Mitigation
- Real-time risk monitoring & scenario-planning; geopolitical & compliance intel
- Travel – No travel to the region; safe evacuation by experts
- Employee Safety – Strengthen emergency protocols; follow govt guidelines
- Supply chains – Alternative channels for critical supplies
- Market exposure – Volatility in oil & shipping prices & currency, hedge strategically
- Op Resilience: Remote working, adjust project & travel schedules, strengthen intel & protective measures