The Iran-Israel Conflict: A Geopolitical Chessboard and the Dynamics of Trump’s Diplomacy

By Dr. Pooyan Ghamari, Swiss Economist

Executive Overview

The relentless antagonism between Iran and Israel is no longer a shadow war at the periphery of the Middle East—it is the very epicenter of a global strategic chessboard, where every move carries implications far beyond its immediate borders. As the conflict intensifies, the lines between diplomacy, military coercion, and economic power have blurred, revealing the intricate interplay of force and negotiation that defines modern geopolitics.

This article dives beneath the headlines, unraveling the deep historical roots of this antagonism, dissecting the paradoxes of nuclear brinkmanship, and critically examining the effectiveness—and limitations—of Donald Trump’s distinct “maximum pressure” doctrine. It further draws vital lessons from the bitter outcomes of U.S. interventions in Afghanistan and Iraq, questioning the very premise of “breaking” an adversary state in such a volatile region.

At stake is not merely the balance of power in the Middle East, but the future of international security, the credibility of multilateral diplomacy, and the risk of a catastrophic nuclear escalation whose tremors would be felt in every corner of the global economy.

I. Iran and Israel: From Quiet Allies to Open Enemies

The profound rupture in Iran-Israel relations is a story of ideological inversion, strategic paranoia, and shifting alliances. Prior to the Iranian Revolution of 1979, the two countries enjoyed a covert but cordial partnership, unified by mutual fears of Soviet expansion and Arab nationalism. The collapse of the Shah’s regime, however, ushered in a theocracy bent on challenging what it saw as illegitimate Western (and Israeli) presence in the region.

In the decades since, Iran’s steady cultivation of proxy militias—from Hezbollah’s rise in Lebanon, to Hamas in Gaza, to the Houthis in Yemen—has transformed the map of regional warfare. Iran’s strategy is neither wholly ideological nor purely pragmatic; it is a calibrated blend of resistance rhetoric and shrewd statecraft, leveraging local grievances and the fragmentation of Arab politics to extend its reach.

Each escalation—be it a suicide bombing in Buenos Aires, a cyberattack on Iranian centrifuges, or targeted assassinations—has entrenched the perception on both sides that this conflict is existential.

The escalation since 2023 is not an aberration but an inflection point. The October 7th Hamas attack, the reciprocal strikes in Syria, and the unprecedented missile salvos in 2024 and 2025 have signaled that the era of plausible deniability is over. What was once a shadow war has entered the daylight, with both Tehran and Jerusalem willing to risk direct confrontation. The implications are stark: traditional deterrence mechanisms are failing, and the risk of a miscalculation spiraling into regional conflagration has never been greater.

II. Nuclear Paradoxes and the Escalation Trap

At the heart of Israel’s strategy is the unyielding belief that a nuclear-armed Iran would be an unacceptable existential threat. This belief is not mere rhetoric; it is hardwired into Israeli security doctrine. Yet, as recent events and expert analyses suggest, the very actions designed to prevent an Iranian bomb—preemptive strikes, covert sabotage, and assassinations—may paradoxically accelerate Iran’s nuclear ambitions.

Every Israeli airstrike that exposes the limits of Iran’s conventional deterrence feeds the argument within Tehran that only nuclear weapons can guarantee the regime’s survival. This is the proliferation paradox: efforts to prevent a bomb can become the very catalyst that drives its pursuit. When the IAEA censured Iran in June 2025, it gave Jerusalem the diplomatic “cover” for a major strike. Iran’s response was to double down, vowing to accelerate enrichment. The cycle is self-reinforcing, and the margin for diplomatic maneuver shrinks with every round.

This is not just a bilateral problem. A nuclearized Iran would almost certainly trigger a regional arms race, forcing Saudi Arabia, Turkey, and Egypt to consider their own programs, and eroding decades of nonproliferation norms. The specter of an Israeli “Samson Option”—the ultimate recourse to nuclear retaliation—would fundamentally alter global security calculations.

III. Proxy Warfare and the Erosion of Indirect Power

For decades, Iran’s genius lay in its ability to wage asymmetric war through proxies, keeping adversaries off-balance and preserving plausible deniability. The “Axis of Resistance”—Hezbollah, Hamas, the Houthis, and Iraqi militias—functioned as force multipliers and strategic tripwires.

But recent Israeli campaigns have severely degraded these assets. Targeted assassinations, electronic warfare, and relentless airstrikes have diminished the effectiveness of Hezbollah and Hamas, eroding Iran’s ability to project power by proxy. With fewer levers to pull indirectly, Iran faces the unpalatable prospect of direct confrontation—on ground it does not control, and at a time of weakened deterrence.

This new reality increases the risk that Iran will fall back on its remaining trump cards: ballistic missiles, cyber warfare, and—most dangerously—the open pursuit of a nuclear deterrent. For Israel, the dismantling of the Axis is a short-term gain that comes with long-term uncertainty; for Tehran, the loss of proxies compels a recalibration of strategy that could prove unpredictable.

IV. War as Diplomacy: The Logic of Coercion

Both Iran and Israel, with the United States as a central—if sometimes reluctant—actor, have refined the use of military force as a tool of diplomatic coercion. Every missile strike, every cyber-attack, and every public threat is part of an elaborate signaling game, meant to shift the adversary’s calculus without crossing the threshold into total war.

Israel’s “Operation Rising Lion” in June 2025 was a textbook case: a precise, multi-layered offensive targeting nuclear and military infrastructure, intended not only to set back Tehran’s technical capabilities but to send a message to its leadership and population. Iran’s retaliatory strikes, equally deliberate, were calibrated to demonstrate reach and resolve without inviting overwhelming retaliation.

The dilemma is acute: the more forceful and overt the coercion, the higher the threshold for credibility, and the narrower the space for de-escalation.

V. Trump’s “Maximum Pressure” and the Transactional Trap

Donald Trump’s approach to Iran blended aggressive sanctions, JCPOA withdrawal, and an unapologetically transactional view of diplomacy. The premise was that pressure would break Iran’s resistance, force a better deal, and deter malign behavior.

The results were mixed. Sanctions hurt Iran’s economy, but the JCPOA withdrawal fractured transatlantic unity and narrowed diplomatic options. Tehran expanded uranium enrichment. U.S. credibility suffered as Iran viewed Israeli actions as U.S.-approved, raising risks to American personnel.

Trump’s model closed off diplomatic exits. The more Tehran perceived strikes as backed by Washington, the less room remained for negotiation.

VI. The Shadow of Afghanistan and Iraq

The legacies of Iraq and Afghanistan loom large. These interventions exposed the limits of regime change, the hollowness of externally supported state-building, and the long-term costs of military adventurism.

Afghanistan collapsed post-U.S. withdrawal. Iraq descended into chaos, empowering Iran. Military “victories” often seed instability, embolden hardliners, and invite retaliatory spirals.

Iran has learned these lessons. Tactical strikes may succeed, but political success is elusive.

VII. War, Markets, and the Global Fallout

A broader Iran-Israel war would rock global oil markets. The Strait of Hormuz is critical; disruptions would spark inflation, currency instability, and supply chain shocks—especially for India and China.

Refugee crises, Gulf state involvement, and intervention by Russia and China would raise complexity. Most dangerously, escalation could shatter nonproliferation norms, triggering nuclear pursuit across the Middle East.

VIII. Strategic Outlook and Policy Implications

1. Military Action Isn’t Strategy: Force alone can’t reshape the Middle East. Iraq and Afghanistan prove it.

2. Diplomacy Must Return: Coercion isn’t a substitute for multilateral negotiation. The JCPOA’s collapse is a warning.

3. Regional Dialogue Matters: Durable peace needs local buy-in, not imposed order.

4. Crisis Communication is Vital: Hotlines and backchannels help prevent war by miscalculation.

5. Think Globally: This isn’t just a regional matter. The global economy and security system are at stake.

IX. Final Reflections

The Iran-Israel conflict is testing the limits of 21st-century statecraft. There are no easy solutions. Deterrence is fragile. Force is blunt. Sustainable peace demands patience, humility, and imagination.

History must guide the path forward. A nuclear Middle East is too dangerous for the world to accept.

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