Manila, August 28 — Six months after the United States and Israel launched coordinated strikes on Iran on February 28, the country remains intact but faces mounting economic strain. The campaign’s immediate context traces back to Israel’s October 7, 2023, war in Gaza, which weakened Iran’s regional allies and escalated tensions into a June 2025 conflict, culminating in the current U.S.-Israel offensive.
Tehran’s leadership framed the initial military response as a survival victory, but six months later, that narrative frays as economic pressure intensifies. The war’s trajectory now circles back to economic coercion, echoing the “maximum pressure” strategy of Trump’s first term but with greater force. Iran’s oil exports have fallen below half of pre-war levels, while inflation nears 90 percent and food prices more than double year-on-year.
The Treasury’s August 24 launch of Operation Economic Outcast expanded sanctions targeting oil transport and financial networks, deepening a blockade that began when Iran closed the Strait of Hormuz on February 28. Naval enforcement has fused with the closure, creating a chokehold on trade.
Leadership continuity remains fragile. Following the assassination of Supreme Leader Ali Khamenei in the opening strike, his son Mojtaba was appointed over a week later. Six months on, he has not made a verified public appearance, with only his portrait carried in mourning ceremonies and decrees issued in his name. Senior IRGC commander Mohammad Pakpour and armed forces chief of staff Abdolrahim Mousavi were killed early in the campaign, forcing Tehran to appoint new military leaders like Ahmad Vahidi as IRGC chief and Ali Abdollahi as chief of staff by August 10.
These appointments signal a preference for loyalty over reform amid ongoing rebuilding. The economic siege exposes Iran’s long-standing vulnerabilities.
Sanctions dating to the 1980s and UN resolutions since 2006 had already strained the economy, with governance failures acknowledged by both Khamenei and President Pezeshkian. Partnerships with China and Russia, including a $400 billion, 25-year deal, failed to deliver stability. Now, the state’s structural exposure is laid bare as sanctions bite harder, forcing a reckoning with narratives that once blamed external forces alone.
What comes next hinges on whether Iran can sustain its economy under intensified pressure. The U.S. campaign’s next phase will likely target remaining financial lifelines, while Tehran’s ability to rebuild command structures and manage internal dissent will test its resilience.
The outcome will shape not just regional dynamics but the broader calculus of power in the Middle East.
