Israel-Iran conflict is spiraling out of control, putting energy supply chains at risk

The big question is whether the conflict can remain contained to the territories of Israel and Iran or whether it could spiral out of control.

By Rajeev Agarwal

In a surprise but not unexpected move, Israel launched unilateral and unprovoked air and missile strikes deep into Iranian territory in the early hours of 13th June. In a televised address to the nation, Prime Minister Benjamin Netanyahu called it a necessary move to ensure Israel’s survival. Alleging that Iran had developed enough fissile material in the past few months to build up to nine nuclear bombs, he said that waiting was no longer an option and Israel was compelled to launch ‘Operation Rising Lion’, a targeted military operation to roll back the Iranian threat to Israel’s very existence. Around 200 Israeli Air Force fighter jets struck more than 100 nuclear, military and infrastructure targets across Iran in one night.

The initial wave of Israeli strikes on 13th June was precise and backed by real-time intelligence. It not only struck successfully the most critical nuclear enrichment facility at Natanz, around 200 km away from Tehran, but it also did a repeat of what the ‘Mossad’ did in Lebanon in September 2024, when it took out the entire top leadership of Hezbollah, including Hasan Nasrallah in targeted strikes and assassinations. This time too, the Israeli intelligence took out the central military leadership and nuclear scientists of Iran over one night of spectacular intelligence-based operations.

Iran was quick to respond and struck the heart of Tel Aviv in Israel on 14th June. In a major missile strike, it struck many parts in Tel Aviv, including a direct strike on Israel’s Military HQ building ‘Kirya’, which is often called Israel’s Pentagon.

With the strikes continuing, the big question is whether the conflict can remain contained to the territories of Israel and Iran or whether it could spiral out of control, engulfing not only the region but threatening a conflict that could have global ramifications.

Can the Conflict Remain Contained?

Israel started this war on the pretext of neutralizing any attempt by Iran to get a nuclear weapon. Having already conducted strikes over Natanz and Fordow, it is clear that Israel is likely to follow up on its stated objective. Within this is also the unstated objective of forcing a regime change in Iran. By taking out the top military leadership in Iran and threatening deep strikes, Israel is hoping that the many people in Iran, who have often tried to revolt against the Islamic regime, will be able to mobilize enough support and momentum to topple the regime.

For Iran, this war is about survival as well as prestige. It has made it very clear that the nuclear enrichment program is its sovereign right and that it will not give up this right. It has often been stated that there is no plan to convert this nuclear program into a weapons program. Other than the fact that Iran possesses enough Highly Enriched Uranium (HEU) enriched to 60 percent, which can be converted quickly into weapon-grade Uranium (enriched up-to 90 percent and above), there has been no clear proof presented on Iran’s nuclear weapons program. As recent as 25th March 2025, in an intelligence assessment by the Director of National Intelligence of the US, Tulsi Gabbard said,” the intelligence community continues to assess that Iran is not building a nuclear weapon”.

In fact Iran and the US were scheduled for their fifth round of talks on a possible nuclear deal on 15th June, which has since been called off after Israel undertook this unilateral military action. Iran, therefore, feels cheated and sabotaged, while Israel feels that it is now or never to subjugate Iran in submission and possibly overthrow the regime.

In such a scenario, the possibility of the conflict spiraling out of control is very large.

Chokepoint at Strait of Hormuz

From a global perspective, the biggest threat is from Iran threatening to close the Strait of Hormuz. If it happens, it could have a devastating effect on the global economy. The Strait is the only sea exit from the Persian Gulf to the Gulf of Oman and the Arabian Sea in the Indian Ocean. According to the US Energy Information Administration, about 20 percent of global oil consumption flows through the strait, and is described as the “world’s most important oil transit chokepoint”.

Major oil-exporting countries like Saudi Arabia, Iran, the UAE, Kuwait, Iraq, and Qatar rely heavily on the Strait to transport their oil to international markets. It also handles large quantities of liquefied natural gas (LNG) exports, especially from Qatar, the world’s second-largest LNG exporter.

Major energy-importing nations like India, China, Japan, South Korea, and European countries rely on oil imports from the region and any closure or disruptions could lead to inflation, supply chain disruptions, and recessionary pressures in multiple economies.

Plus, the threat of Houthis in Yemen blocking any ships across Bab-al-Mandeb in Red Sea, in solidarity with Iran, adds to the complications.

Energy Supply Disruption Could Trigger US Entry into the Conflict

In any case of oil supply disruption, the US is likely to be forced to join the battle directly. The US Fifth Fleet in Bahrain could get involved soon. China, which is the largest oil importer too, is likely to assist Iran more directly, more through military supplies and satellite imagery. Russia, having signed a 10-year “comprehensive strategic partnership treaty” with Iran in January 2025, is likely to step in too. Having already committed modern weapon platforms to Iran after Iran’s October 2024 brief military spat with Israel, any supplies of S-400 Air Defense Systems or modern fighter aircraft from Russia could not only escalate the conflict but also add to the military muscle of Iran.

In any of the above cases, the role of key Arab nations in the region would be critical. If the US or any Western assets in any of the regional countries are attacked, how will they react?  Also, any disruptions in oil supplies will be a critical decision point in their calculus.

The possibility of terrorist groups like the IS or Al Qaeda, or any of their affiliates or offshoots, taking advantage of the situation and launching rogue attacks is a strong possibility. If that happens and the blame is pinned on Iran, again, the conflict could escalate.

Conclusion

It is often said that it is easy to initiate a conflict but very difficult to call it off. In the case of the Israel-Iran conflict, the added risk of it spiraling out of control and engulfing the entire region makes it even more dangerous. Israel may have initiated the conflict based on an unsubstantiated threat, but as it is finding out very early into the war, Iran is a formidable adversary and stand-off weapon platforms and intelligence-based assassinations cannot roll over Iran.

Iran possesses military capabilities that can hurt Israel despite the latter having ‘iron-clad’ support of its Western allies. With Israel’s politico-military objectives yet to be fully realized in Gaza even after three years of relentless and almost unopposed strikes, Iran is definitely going to be a much harder nut to crack.

(Rajeev Agarwal is a Senior Research Consultant at Chintan Research Foundation.)

Views are personal and do not represent the stand of this publication.