The war between the US and Iran has grown far beyond a conventional military clash. It is now a sprawling, multidimensional contest in which neither side can achieve its objectives quickly, cheaply or cleanly.
Early signs point to a grinding stalemate, shaped by misaligned incentives, asymmetric capabilities and the complex dynamics at play across multiple domains. Yet the situation remains fluid. What is already clear is that this conflict was far easier to start than it will be to end and its consequences ripple across the global economy.
Conceptually, the war can be understood through a 4x4 lens: four principal actors — the US, Iran, Israel and the Gulf states — operating across four interlinked theatres of influence: psychological, economic, informational and military.
At the centre of this war are two actors with fundamentally different goals, constraints and political realities: the US and Iran. Tehran’s strategy is built on endurance. Decades of sanctions have battle-hardened the economy and the political system, leaving the country less vulnerable to shocks than many of its adversaries might assume.
More importantly, Iran’s pain threshold now exceeds that of the US. In practical terms, Tehran can absorb economic punishment and the risks of prolonged confrontation in ways that democratic societies — constrained by elections, public opinion and markets — cannot. This capacity underpins Iran’s long game. Simply surviving a confrontation with the world’s most powerful military can be framed as a strategic success.
Moreover, Iran’s leadership sees the conflict through an existential lens: Israel is a mortal threat, the US a long-standing enemy and regional rivals part of a broader containment architecture. In this worldview, compromise carries a big risk while escalation is a legitimate instrument of statecraft.
By contrast, the US entered the confrontation expecting something far more limited. In Washington, the assumption was that the episode would resemble previous interventions: swift, contained and politically manageable — akin to the campaign in Venezuela. But reality has proved far more complex. The US now confronts a conflict with shifting objectives, rising costs and no obvious off-ramp.
Domestic politics further constrain American options: the trifecta of markets, missile mathematics and midterm elections heavily shapes decision-making. The Trump administration needs a face-saving exit, but the conditions for one are steadily narrowing. Achieving decisive success — regime collapse or neutralising Iran’s strategic capabilities — would almost certainly require boots on the ground, an option deeply unpopular domestically and strategically fraught abroad.
A deeper realisation is also emerging in Washington — one reminiscent of the recent trade confrontation with China, in which escalating tariffs revealed Beijing’s leverage over rare earths. The US has now discovered Iran’s own structural leverage: the ability to disrupt the arteries of the global energy system and, if pushed, destabilise the world economy. Escalation without fully accounting for such leverage reveals a clear miscalculation and it underscores the gulf between ambition, ability and appetite in Washington.
Israel’s maximalist approach complicates matters further. For Israeli leaders Iran is an existential threat. Any pause or perceived concession risks emboldening Tehran. Israel seeks a clear, decisive victory before Iran can regenerate its capabilities while Iran is comfortable with a protracted confrontation. The two approaches are fundamentally incompatible, producing a strategic tension that reverberates across the region.
Israel’s maximalist approach complicates matters further. For Israeli leaders Iran is an existential threat. Any pause or perceived concession risks emboldening Tehran.
Caught in the crossfire are the Gulf states. They face a conflict they neither sought nor can fully control. Their core value proposition — predictability, safety and connectivity — has been shaken. As analysts repeatedly note, Gulf security is inseparable from global security: the region sits at the centre of energy flows and critical maritime trade routes.
Gulf leaders now face a dilemma. They must choose between angering their closest ally — and security guarantor — by resisting escalation or provoking the wrath of a powerful neighbour they must co-exist with long after the war ends. Attacks on infrastructure have already disrupted markets and trade, eroding confidence in the region’s stability and international reputation. Their overriding incentive is to end the confrontation quickly, but this will alter regional power balances.
The conflict unfolds not only on battlefields but across multiple, interconnected theatres — psychological, economic, informational and military. Thinking in terms of these arenas is crucial: it shows how pressure in one domain amplifies effects in another and how Iran is exploiting these to shape agendas.
The psychological dimension has been particularly destabilising. Iran’s attacks are designed not just to destroy assets but to erode confidence in the stability of the Gulf. This “horizontal war” spreads fear across borders, targeting perceptions as much as facilities. The Gulf’s reputation as a secure global crossroads — once almost sacrosanct — has been shaken. Fear, deliberately employed, acts as a force multiplier.
The economic theatre is no less consequential. Iran is waging asymmetric economic warfare. By threatening the Strait of Hormuz it can hold global energy markets hostage. The consequences are immediate: energy price spikes, food inflation, collapsing shipping insurance markets and disrupted supply chains. Indeed, the International Energy Agency now describes this as the largest oil supply disruption yet.
Iran’s attacks are designed not just to destroy assets but to erode confidence in the stability of the Gulf. This “horizontal war” spreads fear across borders, targeting perceptions as much as facilities.
Global priorities in energy policy have shifted, from sustainability to affordability, and now to security. Tehran understands this shift and is exploiting it. Its objective is not necessarily outright victory but to make the conflict so costly that external actors hesitate to escalate again. In doing so, Tehran hopes to force the international system to accommodate a new regional balance of power.
The informational theatre is equally critical. Iran’s messaging is disciplined: survival equals victory. The US and Israel, by contrast, operate in a more complex narrative environment. Aggressive military action risks reinforcing the perception — particularly across the Global South — of overwhelming force deployed against a weaker adversary, outside the bounds of international law.
Such framing can generate sympathy for Tehran even among audiences critical of the regime itself. Compounding this challenge is a credibility gap in Washington. President Donald Trump’s statements, often designed to calm markets, are frequently divorced from realities on the ground and are at times misleading or inaccurate, risking longer-term erosion of credibility.
The military theatre, while the most visible, is paradoxically the least decisive. Iran is militarily outmatched. The US and Israel have inflicted significant damage on leadership, missile infrastructure, naval assets and nuclear facilities. Yet tactical successes have not translated into an obvious advantage and airstrikes alone will not topple the regime.
Iran has internationalised the conflict and its low‑cost drones cost a fraction of air defences, creating an unfavourable arithmetic for America in which defending against mass, inexpensive projectiles steadily erodes its missile‑defence stockpiles.
For the US, victory is narrowly framed: either the collapse of the Iranian regime or the reopening of the Strait of Hormuz, and the latter would merely restore the pre-war status quo, raising the uncomfortable question of what, truly, has been achieved?
The asymmetry in how the key actors perceive war produces a deadlock: those most capable of prolonging the conflict have the least incentive to compromise and those seeking an off-ramp have the least leverage.
Across the four theatres, dynamics reinforce one another. Psychological shocks unsettle markets; economic disruption fuels political pressure; information battles shape global perceptions; military actions generate new grievances and escalation pathways.
The result is a conflict far easier to sustain than resolve. Attrition may ultimately prove the decisive currency in shaping the region’s emerging order.
• Gopaldas is a director at Signal Risk and visiting fellow at the London School of Economics.
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