Trump stands to lose more from his standoff with Iran 

President Trump’s roller coaster “maximum pressure” campaign against Iran got off the ground last year after he ditched the Iran nuclear deal on 8 May, 2018. In the course of just one year the campaign, jolted by recent US military reinforcements in the Persian Gulf and the shooting down of a US military drone by Iran’s IRGC on 21 June, has pushed the two nations to the brink of a shooting war. Both sides intend to avert the war but it will be hard to defuse simmering tensions, despite a flurry of ongoing diplomatic initiatives. War or no war, the “maximum pressure” campaign looks set to end up producing a series of consequences more harmful to the US than Iran.

A crisis of Trump’s own making

The principal motive behind Trump’s withdrawal from the nuclear deal was to pressure Iran to submit to US foreign policy dictates in the Middle East. Secretary of State Mike Pompeo’s 12-point demands were clearly meant to bring about regime change in Tehran and to reorient Iran’s foreign policy away from anti-US pursuits to a pro-US posture. It was a foregone conclusion that Iran would reject the demands outright but Trump chose a highly risky course of action to force Iran to comply.

A series of intrusive sanctions soon followed. Trump resorted to extraterritorial jurisdiction to illegally reduce Iran’s oil exports, a key source of national revenue, to zero and thus pile up massive economic pressure on the Iranian government so that it would simply collapse. Lately, Washington has sanctioned Iran’s Supreme Leader Ayatollah Ali Khamenei in what President Hassan Rouhani branded “idiotic and outrageous.” In a highly anticipated reaction, the Iranian Foreign Ministry said the sanctions permanently closed the door to diplomacy with Washington, and the Supreme Leader dismissed the US offer of direct negotiations as mere “deception” to strip Iran of its power.

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Iran’s refusal to negotiate has put Trump’s Iran strategy in the doldrums. He has offered to negotiate without preconditions and at the same time threatened Iran with obliteration. The White House is also stumbling into failures to build a global coalition to square off with Iran. America’s European allies, other than the UK, see the US as the provocateur in the standoff and have refused to back Washington’s anti-Iran drive. In a recent NATO meeting in Brussels, France warned the US not to drag the alliance into anti-Iran military missions. In the Middle East, only two Gulf allies – Saudi Arabia and the United Arab Emirates (UAE) – stand by the US.

A scenario of shooting war consequences

Left by most allies in the lurch, Trump prefers a “wait and see” policy approach to see if Iran will budge. But for Iran the preferred policy is to keep pushing back and forcing the US to recommit to the nuclear deal and dismantle the sanctions. Iran cannot simply allow a protracted impasse to cause an economic abyss for itself; neither can it afford to overlook the prospect of domestic turmoil to be unleashed by Trump’s “maximum pressure” campaign. After Trump’s re-imposition of sanctions the Iranian currency rial has lost two-thirds of its value, inflation has skyrocketed to 40 per cent and the economy is set to shrink by six per cent in the current fiscal year. The possibility of Trump getting re-elected in 2020 is also a big concern for Iran.

In the event of a hot war, as CNN reports, America’s overwhelming firepower may prevail for a while but Iran and its regional allies will keep inflaming the entire region for a long time. Hezbollah’s precision missiles are ready to target Israel, so is the case with Iran’s Shia militia partners in Iraq who would hardly hesitate to target US military bases and personnel in Iraq. Some Iraqi military bases manned by American troops have reportedly come under rocket and missile attacks. US military forces in Afghanistan are also likely to draw fire from Iran’s Afghan allies. Iran-backed Houthi fighters in Yemen are already hamstringing Saudi Arabia, a strong supporter of Trump’s “maximum pressure” campaign.

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The economic consequences of the war are likely to be more painful for the American economy, not to speak of devastation to the global economy. The first thing Iran is most likely to do is to shut down the Strait of Hormuz, a crucial choke point of global oil shipments. Oil prices are projected to spike over $250 per barrel, as reported by OilPrice. Recent attacks on oil tankers off the coast of Oman and southeast Iran quickly pushed oil prices up by 10 per cent. A surge in oil price is expected to hurt America’s consumer spending which may cause a contraction in its economy, like similar downward spirals created by the Saudi-led oil embargo of 1973-74, the 1979 Iranian Revolution and the 1990 Iraqi invasion of Kuwait that roiled the global oil markets and economy.

A scenario of no war consequences

A no war scenario looks improbable, given the hardened positions taken by the US and Iran. Trump seems unlikely to discard his cavalier attitude, neither is Iran, unlike North Korea, which is seeking dialogue in the face of Trump’s “fire and fury” approach. In case de-escalation follows, the political and diplomatic fallout promises to be no less detrimental to the US than the consequences of a shooting war.

First off, Trump’s “maximum pressure” policy is creating a big crisis for America’s credibility in global leadership. George W. Bush’s illegal Iraq War created serious dents in the world community’s confidence in America; Trump’s illegal and strong-arm tactics are further eroding global confidence in US leadership. What’s more, Iran’s steadfastness to stand up to America will greatly undercut America’s policy of threat and intimidation to force weaker parties into submission in the future. Other anti-US states may be encouraged to defy America’s dictates.

A more serious dent may surface in US–GCC relationships. So far, America is assured of security from its Gulf allies against Iranian threats but they have now noticed with great dismay that Washington, after the downing of a high-tech US military drone by the IRGC, failed to retaliate against Iran. Riyadh and Abu Dhabi may view US defence commitments as hollow and secretly initiate a rapprochement with Tehran to build confidence and increase cross-Gulf cooperation.

America’s global rivals China and Russia are keen on exploiting escalations in Iran-US relations. The more the US pressures Iran the more the Iranians move to Moscow and Beijing for support. All three countries, reeling under US sanctions, have a common interest to resist and contain US global hegemony. Despite strategic differences, Iran is a big node of Russia’s Syria strategy and a major partner in the fight against jihadi militancy in the Middle East and in the Caucasus. For energy-hungry China, Iran is a significant cog in its “Belt and Road Initiative.” It is neither in China’s nor Russia’s interests to let America subdue Iran and control its oil resources. In any case, Trump stands to lose more from the standoff with Iran.

Iran Deal – Cartoon [Sabaaneh/MiddleEastMonitor]

The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.