What Would An Israel-Iran War Look Like?

Without doubt, one of the biggest political risks in the world going into 2013 is the possibility that Israel will attack Iran to halt its nuclear programme. With this in mind, Business Monitor Online has just published a scenario of how an Israeli air strike on Iran’s nuclear facilities would play out. Although this is not our core forecast, we believe that risks of an Israeli-Iranian military conflict will rise in 2013, especially if Tehran fails to satisfy Israeli concerns about its nuclear programme, and if hardliners are returned to power following Iran’s June 2013 presidential election.

In our scenario, we outline answers to the following questions:

  • Would Israel act alone against Iran?
  • How would Iran respond, militarily, and what constraints would it face?
  • How long would the conflict last?
  • What would be the response of the US, Europe, Russia, and China?
  • What would be the response of other Middle Eastern countries?
  • What would be the impact on Middle Eastern financial markets?
  • What would be the economic impact for Israel, Iran, and Lebanon (which is likely to be drawn into the fray)?
  • How far would oil prices rise, and what can the world do to mitigate a price shock?
  • What would be the impact on global markets?