Episode summary
Iran Conflict: How Long, and How Bad?
Exchanges (Goldman Sachs)
· · Guests: Sanam Vakil, Dennis Ross, Kevin Donegan
Summary
The discussion argued that the Iran conflict is less a short military episode than a struggle over regime survival, leverage, and control of energy flows. Sanam Vakil said Iran sees the war as an existential threat and is trying to spread the costs as widely as possible while seeking eventual sanctions relief and guarantees against another round of conflict. She said the United States and Israel can degrade Iran’s nuclear, missile, and drone capabilities, but Iran can still impose pain asymmetrically and keep the conflict going.
A central theme was the Strait of Hormuz. Dennis Ross said President Trump could only credibly declare victory if the flow through the strait is no longer under Iranian control, ideally through convoys that change the reality on the ground. He argued a mediated outcome would be faster, but still requires visible changes in the strait and a leadership structure in Tehran capable of making a deal. The panel also questioned whether domestic unrest would force an end soon; Vakil said protests may rise, but revolution is unlikely under wartime repression.
Vice Admiral Kevin Donegan said the U.S. and partners have rehearsed convoy operations for years and could get ships through, but not restore normal trade immediately. He said oil flows would not return on an on/off switch, insurance and shipping firms would need time, and even successful convoys might only restore part of normal throughput.
Key takeaways
- Sanam Vakil said Iran’s goal is regime survival, not simply closing the Strait of Hormuz, and that sanctions relief would require a broader negotiation.
- Dennis Ross argued Trump can only claim victory if the U.S. changes control of traffic in the Strait of Hormuz, ideally with convoy protection.
- Vakil said Iran can still wage an asymmetric campaign with drones and obstruction even after U.S. and Israeli strikes degrade its conventional capabilities.
- Vakil said domestic unrest is unlikely to end the war quickly because the Islamic Republic remains able to repress dissent and the opposition is divided.
- Kevin Donegan said convoy operations are feasible, but they would not instantly restore normal oil and LNG flows through the strait.
Notable quotes
“For Iran, this is seen to be a regime change war with objectives of overthrowing or destabilizing the Islamic Republic in a significant way”
“The costs of this war have spread quite significantly, not just through strikes across the Gulf States, but we've seen market impact on the energy side”
“I think the key is the following. It's the Strait of Hormuz”
“We spend a lot of time planning for a contingency, along with other nations, on if Iran in the past had declared the straits closed”
“To be frank something like this, would never be to replace the flow of oil out of the straits, it can't be done”
How the episode opens
With the Iran conflict now in its fourth week, uncertainty around its duration and associated disruptions to energy supplies remains high amid continued swings between de-escalatory and escalatory headlines. So, how long could this conflict last? What's at stake for the key players?
And what will it take to restore global energy flows? I'm Allison Nathan and this is Goldman Sachs Exchanges. Each month I speak with investors, policymakers, and academics about the most pressing market moving issues for our Top of Mind Report from Goldman Sachs Research.
This month I spoke with Sanam Vakil, director of the Middle East and North Africa program at Chatham House, Ambassador Dennis Ross who served as a Middle East advisor in five US administrations, and Vice Admiral Kevin Donegan, former Commander of the US Navy's Fifth Fleet. I started out by asking Sunam what this conflict is about for Iran. For Iran, this is seen to be a regime change war with objectives of overthrowing or destabilizing the Islamic Republic in a significant way.
So, the system or what remains of it is fighting for its very survival with the aim to spread the costs of the war horizontally and as widely as possible so that when offramps do appear, that this war is so costly for everyone that Iran could perhaps obtain guarantees that it will not be repeated again in six months or a year or in a few years when external powers might think that the time is right to revisit another round with the Islamic Republic. So, Iran is viewing this as an existential risk, right? Yeah.
More than a risk. They weren't prepared for this war. They knew after last summer's war, the 12 Day War, that there would be a boomerang effect from the Israeli strikes and the US entry because no side in the war really achieved full victory.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- iran conflict
- strait of hormuz disruption
- energy infrastructure attacks
- global energy flows restoration
- regional key players
Companies and tickers mentioned
- Chatham House
- Goldman Sachs
Watch the episode
Watch “Iran Conflict: How Long, and How Bad?” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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