Middle East Peace on the Horizon Part Two
INTRODUCTION
This series is intended for those who are interested in the interplay of geo-politics and markets. In this new multi-polar world, the relationship between markets and geo-politics is becoming crucial to understand. My intention is to bridge the gap between these two areas. Sometimes I will focus on geo-politics or markets and other times a combination of the two.
My philosophy is to do my utmost to be open minded. We all have biases based on our experiences in life and I try to remain cognizant of that. I welcome debate and conversation.
TOPIC OF ANALYSIS
This is part two of my previous post, which you can read here: https://macroboymonthly.substack.com/p/middle-east-peace-on-the-horizon
That first article reflected on the Middle East before the recent U.S. strikes on Iran’s nuclear facilities. This follow-up examines the situation after those strikes.
Across media outlets and social feeds, opinion is flying fast about the U.S. action. My aim here is to cut through the noise and focus on the five core objectives of the strikes:
Significantly degrade Iran’s nuclear program
Convince the Iranian regime to end its nuclear ambitions
Deter Iran from rearming its proxies and expanding its missile arsenal
Destabilize the Iranian regime to increase the chances of overthrow
Facilitate a permanent ceasefire in the Israel–Hamas conflict
I’ll assess each objective to determine whether it was partially or largely achieved.
RELATED VIDEOS
Interview on NewsNation with Chris Cuomo and General David Petraeus, former CIA director—concise insights into these strategic goals.
Episode of the Call Me Back Podcast covering prospects for an Israel–Iran ceasefire and the future of Iran’s nuclear program.
ANALYSIS
Degrading Iran’s nuclear program
At present, the strikes have undeniably set Iran’s nuclear efforts back. However, describing the program as “obliterated” overstates the result. Most analysts agree the facilities were damaged—estimates of the setback range from a few months to several years. A key concern is the fate of enriched uranium stockpiles, especially the 60%-enriched reserve that has no civilian purpose. Its whereabouts are still unknown.
Persuade the Iranian regime to end its nuclear program
Asking Tehran to abandon its nuclear program outright was always ambitious. Iran has maintained its program close to a breakout threshold to minimize weaponization time while deterring strikes. Their refusal to eliminate their enrichment program triggered Israel’s zero-tolerance response. October 7th’s attacks reinforced Israel’s resolve to remove any existential threat. The U.S. shares those geopolitical incentives: long-term Middle East stability hinges on Iran’s nuclear rollback.
Convince the Iranian regime to not rearm it proxies and expand its missile program
Iran’s missile program poses a serious existential threat to Israel. As a small nation with densely concentrated population centers and critical infrastructure, Israel could be devastated by a massive missile barrage that overwhelms its air defenses. The danger is compounded by Iran’s strategy of arming proxy groups across the region, multiplying the vectors of attack. Tehran continues to deny Israel’s legitimacy—referring to it as “the Zionist regime”—and has repeatedly called for its destruction. However, sustained military pressure and diplomatic isolation may compel Iran to delay or scale back its efforts to rearm these proxies, at least in the near term.
To Destabilize the Iranian regime and make it vulnerable to being overthrown
Of all the strategic objectives, this is arguably the most difficult to achieve. Yet, lasting peace in the Middle East is hard to imagine while the current Iranian regime remains in power. Despite being deeply unpopular among much of the Iranian population for decades, the regime has shown remarkable resilience. In my view, while the ruling elite is firmly committed to a theocratic ideology, the majority of Iranians are far more secular in outlook.
The regime’s persistent demonization of the United States and the broader West is not just ideological—it’s a calculated effort to dissuade the population from aspiring to Western values such as freedom of religion, expression, dress, and press. These values stand in direct opposition to the regime’s authoritarian control.
For the Iranian people to be truly liberated, the international community—especially Western democracies—must take a firmer stance. This begins with making unequivocal statements in support of regime change, sending a clear message to both the regime and the Iranian people about where the free world stands. The notion that Iran’s political future is solely an internal matter is, in my view, a flawed and passive approach. The regime is already weakened—primarily by Israeli actions and, to a lesser extent, by U.S. pressure. This vulnerability should be exploited through sustained diplomatic, economic, and informational pressure to press the advantage and support the Iranian people’s aspirations for freedom.
Facilitate a permanent ceasefire to the Israel-Hamas war
Iran is a critical supplier of missiles and armaments to Hamas. For some time now the concern is that if Israel were to leave Gaza, Hamas would get re-armed by Iran. So on the one hand Hamas as a successful PR campaign as can be easily seen by the number of demonstrations in support of their cause and general rise in Anti-Semitism, but on the other hand has suffered a great deal militarily and losing one of their major backers in Iran. Will Hamas although motivated to continue in large part because of the PR success or will they give up because they Iran is weak, unable to defend themselves and therefore likely unable to support Hamas. My feeling is that without the backing of Iran, they don’t have the kind of support they need to continue, unless they are going to completely rely on stealing international aid to fund their war machine. That being said I think that the blow to Iran, will be sufficient for Hamas to surrender and bring and end to this war. Israel for it’s part should be more willing to leave Gaza if they think Hamas can’t be rearmed and perhaps even willing to again offer the ultimate necessary political solution of a Palestinian state. All in all I think the chances are significantly higher now that we get a permanent ceasefire in the coming weeks.
CONCLUSION
While the situation in the Middle East is undeniably complex, there are a few reasonable conclusions that can be drawn. Chief among them is that the Iranian regime remains the principal source of conflict and instability in the region. This is not to suggest that replacing the current regime with a progressive, democratic government would solve all of the Middle East’s problems. A future Iranian government—even a more moderate one—might still assert its right to enrich uranium.
However, the real danger lies in the current regime’s unique combination of ideological ambition and nuclear aspiration. A government committed to regional domination and armed with nuclear weapons would pose an intolerable threat—not just to Israel, but to the broader international order. Preventing this outcome must be a strategic imperative, even if it comes at significant cost.
Some may argue that the recent Israeli and U.S. strikes on Iran have only accelerated the nuclear ambitions of the current regime. But that line of reasoning overlooks a critical point: inaction would have likely produced a very negative result. Had the Iranian regime concluded that it could stockpile 60% enriched uranium, attack Israel directly and through proxies, and face no meaningful military response, it would almost certainly have proceeded to the next stage of weaponization. Deterrence, not passivity, is what ultimately shapes the calculations of regimes like Iran’s.
Disclaimer: Nothing presented is investment advice. The information presented is based on my understanding of the subject matter at the time of publication. Both financial markets and my opinion can change at any time. No liability is accepted for any actions taken in response to material presented. This series (or newsletter) is for informational and entertainment purposes only. Please contact a qualified advisor before making investment decisions.