US–Israel Strikes on Iran: What Happens Next? | FT Experts Analyse the Middle East Conflict

Why It Matters

The confrontation could reshape Middle East security architecture and trigger volatility across energy markets, directly affecting investors and policy makers worldwide.

Key Takeaways

• US‑Israel strikes aim to deter Iran's nuclear program
• Iran's retaliation raises risk of broader regional war
• Markets react to heightened geopolitical uncertainty and oil prices
• US domestic politics constrain further military escalation
• Gulf states weigh alignment between US and Iran amid tensions

Pulse Analysis

The February 28 coordinated air campaign by the United States and Israel marked a decisive escalation in the long‑standing tension over Iran’s nuclear ambitions. By targeting key facilities, the allies signaled a willingness to use force to enforce non‑proliferation norms, while also testing Tehran’s resolve. Analysts note that the strikes were calibrated to avoid a full‑scale invasion yet demonstrate that strategic deterrence now incorporates kinetic action, a shift that could redefine future engagement rules in the Middle East.

Domestically, both Washington and Jerusalem face heightened scrutiny. In the United States, congressional factions debate the legality and long‑term costs of further involvement, limiting the administration’s operational latitude. Israel’s coalition government grapples with public opinion that balances security imperatives against war fatigue. Meanwhile, the heightened risk premium has already nudged oil futures upward and prompted equity markets to price in a risk‑off bias. Investors are closely monitoring currency flows, especially in emerging‑market bonds, as the conflict injects uncertainty into global capital allocation.

Regionally, Gulf states find themselves at a crossroads, weighing the benefits of aligning with the US‑Israel axis against the danger of alienating Tehran, a pivotal energy supplier. European capitals, reliant on stable energy imports, are urging diplomatic de‑escalation while preparing contingency plans for supply disruptions. The ripple effects also intersect with Russia’s war in Ukraine, as heightened geopolitical tension could complicate coordination among Western allies. Understanding these intertwined dynamics is essential for policymakers and business leaders navigating an increasingly volatile international environment.

Original Description

In this FT Live subscriber webinar, @FinancialTimes journalists analyse the rapidly escalating conflict in the Middle East following the military campaign launched by the US and Israel on February 28 and Iran’s subsequent retaliation.

Chaired by FT Foreign Editor Alec Russell, the discussion brings together FT columnists Gideon Rachman, Kim Ghattas, Edward Luce and Katie Martin to examine the political, military and economic calculations shaping the crisis.

The panel explores the strategic goals behind the US and Israeli strikes on Iran, the domestic political implications for leaders in Washington and Jerusalem, and the potential consequences for Tehran. They also assess the impact on global markets and the wider geopolitical ramifications for the Gulf states, Europe and other US allies.

As tensions rise, the conversation considers how the conflict could reshape regional power dynamics and influence other global flashpoints, including Russia’s war in Ukraine.

Watch the full discussion to hear expert analysis and subscriber questions addressed by FT journalists.

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