[ANALYSIS] Israel-Iran Conflict: Between the Lines

KUALA LUMPUR, 17 JUN 2025

Israel launched a massive preemptive strike against Iran on June 13th that has seemed to target strategic military locations (radars, air defenses, aircraft), nuclear facilities (Natanz, Arak, and Parchin), and Islamic Revolutionary Guard Corps (IRGC) leadership in several cities, including Tehran, Isfahan, and Tabriz. Initial assessments using satellite imagery show substantial but possibly superficial damage at critical nuclear installations, along with confirmed deaths among senior IRGC officials and nuclear specialists, according to a number of sources. The damage is exacerbated by reports of Mossad operations within Iran.

Clouds of smoke and dust rise from an Israeli airstrike in Tehran on Sunday https://www.nbcnews.com/world/middle-east/live-blog/israel-iran-live-updates-new-attacks-conflict-enters-fourth-day-rcna213182

IIran then retaliated by attacking Israel with massive waves of ballistic missiles and loitering munitions. A considerable amount was intercepted by Israeli and allied air defenses, but some missiles managed to get through, damaging Tel Aviv and hitting Israel's Central Military Command. The amount of firepower used by both sides is significantly greater than anything that has been seen in the area recently, and it is far more than what organizations like Hezbollah or Hamas are capable of. Given that early developments seem to be disproportionately focusing on the IRGC in order to take advantage of possible weaknesses within Iran's military hierarchy, many people believe that Israel's campaign, known as "Operation Rising Lion," has a long-term goal: an Iran regime change. Additionally, Israel has specifically referred to these strikes as the "first stage," indicating the possibility of additional assaults on strategic and economic targets.

As for Iran, their strategy as of now appears to be focused on "inflicting maximum damage" on Israeli military infrastructure and leadership while minimizing civilian casualties, aiming to build domestic pressure within Isreal. Such developments is particularly significant in light of the recent vote of no confidence against Netanyahu's government (which they did survive) as continued Iranian strikes and mounting internal dissent may place further pressure on the government.

Another critical development to note is Hezbollah's current inaction, significantly weakening Iran's traditional proxy defense due to the group's attrition, infiltration, and Lebanese political pressure.

Smoke billows up from the site of an Iranian rocket strike in Herzliya, Israel [Menahem Kahana/AFP] https://www.aljazeera.com/news/2025/6/17/israel-and-iran-trade-strikes-as-hostilities-extend-into-fifth-day

The conflict could now perhaps be viewed to be hinging on a "sustainment vs. escalation dynamic". Does Israel have the ability to maintain its interceptor stockpiles against Iran's finite arsenal of ballistic missiles (estimated at ~3,000, though subject to attrition)? Israel cannot fully dismantle Iran's nuclear program without direct US involvement, potentially incentivizing further escalation to draw America in. Iran faces high-risk deterrence options. For instance, some may point to striking Gulf oil infrastructure (risking global economic shock and diplomatic rupture), attacking US assets (inviting devastating retaliation), or even publicly conducting a nuclear test (extreme escalation with international consequences, but a potential existential deterrent).

SYFCOM notes that the window for de-escalation is narrowing rapidly with each exchange, and controlling the trajectory of this high-intensity conflict is becoming increasingly difficult. Prolonged hostilities are the most likely near-term outcome.

Nevertheless, the conflict poses significant risks to global trade, including Malaysia’s economy. Any Iranian disruption of the Strait of Hormuz (which handles 20–30% of global oil transit) would likely trigger a sharp spike in oil prices, driving up inflation worldwide. Prolonged hostilities could cripple key shipping lanes in both the Persian Gulf and the Red Sea severely disrupting exports and global supply chains. Rising insurance premiums for vessels transiting Middle Eastern waters would further increase costs for manufacturers. In the broader picture, sustained oil shocks could reignite global inflation, destabilize shipping routes, and fragment supply chains.

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