Vinay Kumar
Iran’s hurt, but war isn’t going well for US, its Arab allies, and the rest of us. Numbers show the pain ahead
What if this isn’t war but “a little excursion”, as Trump told Republican lawmakers on Monday? A colonialist’s hunting expedition. It gels with his other remark about ending it “soon”, because there’s “practically nothing left” to target. It also explains why Trump’s W Asia adventure is bereft of strategy. Day 1, Khamenei’s taken out with an Israeli Blue Sparrow missile, shutting the door on negotiations. Same day, a US Tomahawk kills 150. Turns out they are schoolgirls – targeting info was outdated.
Since then, nothing’s turned out the way Trump and Bibi imagined it. Iranians didn’t overthrow their govt, nor did the regime collapse on its own. Iran shut off Strait of Hormuz, although that wasn’t in the Trump-Bibi playbook. It started hitting other Gulf states also, aiming for their lifeline – desalination plants. Thirteen days on, it’s still launching missiles and drones. Meanwhile, the math of war is working against US and everyone else.
In US, gasoline is 20% costlier already. And if war goes on, it will rise further. Iran’s said it will drive crude to an unprecedented $200 per barrel. Can it? Probably not. About 20% of global oil crosses the Strait. Since a 1% drop in supply raises prices by 4%, an 80% rise is possible, which means roughly $110. But, per IMF, just a 10% increase in energy price for a year could raise global inflation by 40 basis points. In the worst case, this Trump-Bibi-engineered energy shock can wipe out half of the world’s 3.3% economic growth projected for this year.
And that’s just the hit from oil-related inflation. Shipping insurance has increased 4-6 times, fuel for planes has doubled in price. When central banks, including US Fed, put off rate cuts – or hike rates to curb inflation – the damage will be worse. The Strait’s blockade has also stalled 30% of world’s urea for agriculture, and key industrial inputs like sulphur, aluminium and helium. Unable to move oil, Gulf states are shutting down wells, which can take weeks or months to restart. Trump’s Gulf allies are getting bombed, and their economies will likely manage to grow at just 1.8% this year. They are also having second thoughts about relying on US. Meanwhile, US is burning through almost $2bn in munitions daily, and 17 of its installations in the region have been hit. Not to forget, 7 US troops are dead, and 140 wounded. For what? Trump must think, and stop the madness.
https://edition.cnn.com/2026/03/05/economy/economy-impact-middle-east-war-intl
Disclaimer
Views expressed above are the author’s own.
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