Iran's Challenge to the International Economic Order

For months, familiar arguments have dominated discussion of the war with Iran. We are told that Israel dragged the United States into conflict, that Washington lacked clear objectives, that Iran posed no imminent threat, that military action only deepens instability, that America should have secured full consensus with its allies before acting, and that diplomacy now requires accepting Iranian enrichment and proxy networks as permanent realities.

The real question is not whether critics can list objections to this war. It is whether the alliances we have built are willing to confront the strategic problem that produced it.

That strategic problem is Iran's long-term effort to achieve regional hegemony in the Gulf and surrounding maritime corridors, backed by proxy warfare, ballistic missiles, nuclear leverage, and the ability to pressure the flow of energy and commerce upon which much of the world depends.

That strategy has required long-term planning, patience, and execution by Iran's leadership.

Too often, Iran's leaders are dismissed as religious fanatics.

Although they may employ religious rhetoric and revolutionary ideology, their behavior reflects the logic common to coercive, totalitarian systems: strategic expansion, domination, and calculated use of power—not religious fanaticism.

Iran's proxy system illustrates this logic in practice.

Through its proxies, Iran has surrounded and pressured Israel, Saudi Arabia, and the Gulf states with antagonistic forces operating across the region.

Houthis in Yemen threaten Gulf and Red Sea shipping and energy infrastructure. Iranian-backed militias in Iraq have projected Tehran's influence while threatening neighboring states. Hezbollah has weakened Lebanon politically and economically while Hamas and Hezbollah together provide forward leverage against Israel.

Iran continues efforts to expand its influence and cultivate proxy networks in Jordan, Syria, Bahrain, eastern Saudi Arabia, the Red Sea region, and elsewhere throughout the Middle East.

Its objective is not simply to pressure one adversary or influence one conflict. It is to weaken states, expand influence, create dependency, and gradually shift the regional balance of power in its favor.

Iran's proxies do not merely threaten neighboring states. They weaken the states within which they operate while destabilizing those around them.

Weakened governments, fractured societies, and dependent militias create conditions in which Iranian influence expands while sovereign authority contracts.

This is not conventional warfare. Conducted through proxies, it is often treated as something less than war. But it is warfare, nonetheless.

The broader international community often prefers to view these activities as isolated incidents rather than acknowledge them as components of a sustained campaign. As a result, it often fails to respond to the broader pattern of behavior these activities represent.

Refusing to recognize the nature of this conduct, however, does not alter its reality.

Iran also understands the importance of its geography and has built its policy around it.

It occupies one of the most strategically important positions in the world. Few major powers enjoy a comparable geographic advantage. Situated along the northern shore of the Gulf and adjacent to the Strait of Hormuz, it sits astride maritime routes essential to global commerce. No other regional power combines a comparable mix of population, geography, proxy reach, and access to critical maritime chokepoints.

Iran's ambitions extend beyond territory. Its support for the Houthis demonstrates an effort to project power from the Persian Gulf to the Red Sea.

Iran spent decades constructing this capability. The current disruption of maritime commerce is not a temporary wartime improvisation. It is a preview of the coercive power Iran had long intended to wield under the protection of a nuclear shield.

That objective is not merely disruption but economic leverage over the commerce flowing through the Gulf and Red Sea—leverage capable of destabilizing economies and constraining nations dependent upon those routes.

That is why Iran cannot be permitted to acquire nuclear weapons.

Under a nuclear umbrella, the proxy networks, missile systems, and maritime coercion Iran assembled over decades could be exercised with diminished fear of retaliation. The objective is not necessarily nuclear war but constraining the response of others while increasing freedom of action.

This broader context explains why debates over imminence often miss the larger point.

Iran currently faces one of its weakest moments in years. Yet even now it retains the ability to pressure commerce and unsettle markets. If such pressure is possible while Iran is weakened, the implications of a rebuilt and nuclear-protected system would be far more dangerous and disruptive to the world economy.

For too long, the international community relied upon partial measures in dealing with Iran while avoiding decisive confrontation. History repeatedly shows that incremental appeasement can encourage rather than moderate coercive powers.

Iran has repeatedly benefited from this pattern. While the international community relied on sanctions, negotiations, and limited responses, Tehran continued expanding its proxy networks, missile capabilities, maritime leverage, and nuclear program. The result is the very system of pressure and coercion that now strains alliances and threatens global commerce.

Nations begin calculating costs differently. One government seeks lower energy prices. Another seeks restored shipping routes. Others fear inflation, recession, supply shortages, or domestic political unrest. As economic pain grows, governments face increasing pressure to seek immediate relief. As these pressures mount, alliance cohesion weakens and collective action becomes more difficult. The goal becomes relief from the symptoms of alliance stress rather than the mechanism that caused it.

Iran understands this dynamic. Its strategy depends upon it.

Tehran's willingness to maintain uncompromising positions even under intense military and economic pressure reflects confidence in this dynamic. Its leaders appear to believe that time, economic strain, and political divisions will weaken the resolve of those opposing them.

For instance, our European allies have been divided over the military campaign and have been reluctant to involve themselves in this conflict. They have offered numerous explanations, among them that this is not their war or that NATO was not attacked and therefore Article 5 was never triggered.

These excuses are themselves evidence of the broader issue.  They are a product of the pressures Iran’s strategy is designed to create.

These pressures did not arise because the United States and Israel chose confrontation. They emerged because Iran had spent decades building precisely this capacity: the ability to fracture alliances, induce rivals to distance themselves, and expand Iranian leverage while collective resistance weakened.

Military action was undertaken to prevent Iran from consolidating the very capabilities that made such pressures possible: the pursuit of nuclear weapons, regional hegemony, and the ability to exert leverage through the Gulf and surrounding maritime corridors.

Fatih Birol, Executive Director of the International Energy Agency, recently described the current crisis as the greatest threat to global energy security in history and warned that markets and policymakers may be underestimating its consequences. Whether one agrees with that assessment in full, the broader point remains clear: instability in the Gulf does not remain confined to the Gulf. Its effects ripple throughout the global economy.

If disruption of the Strait of Hormuz can damage the economies of Europe, Asia, North America, and virtually every major economic region, then Iran is not merely a regional issue. It is a challenge to the collective interests upon which the modern international economy depends.

The central question is whether this challenge will be easier or harder to confront in the future. A nuclear-protected Iran with deeper proxy networks, greater influence over regional governments, and enhanced ability to pressure maritime commerce would present a far more difficult problem than the one that exists today. The purpose of acting now is not to create confrontation but to prevent the emergence of conditions under which meaningful resistance becomes increasingly costly and increasingly uncertain.

This is therefore the moment for America's allies and partners to recognize that the challenge is not solely American, Israeli, or regional. Nations that depend upon secure maritime commerce and the stability of the international economic system have a direct stake in the outcome.

What matters is not whether every ally faces identical risks. It is whether those who benefit from the security of the existing order are willing to share responsibility for defending it.

They should be prepared to support the strategic objective itself: preventing Iran from obtaining a nuclear shield and preserving its ability to dominate critical maritime routes.

That support requires economic, diplomatic, and, if necessary, military coordination among allies and partners whose security depends upon credible deterrence and stable commerce.

This is not merely a regional crisis. It is a test of whether the international order remains capable of defending itself.

David Sobiloff is a New York–based attorney who has practiced law for over four decades and has a longstanding interest in geopolitical and national security issues.