A potential Donald Trump presidency could mark a significant shift in U.S. foreign policy and geopolitics, with a focus on reshaping power structures in the Middle East and resolving the Ukraine-Russia conflict, part of this strategy could be forcing peace talks between Russia and Ukraine while redirecting U.S. military and diplomatic resources toward a more aggressive stance against Iran’s regime. The overall objective would be to establish a lasting U.S. foothold in the Middle East, diminish Hezbollah’s influence, and install pro-Western governments that align with U.S. interests.

Russia-Ukraine Conflict: Pushing for Peace through Strategic Leverage

One of Trump’s key strategies could involve a diplomatic push to end the Ukraine-Russia conflict, with this approach, peace talks between Ukraine and Russia could be forced through economic pressure and incentivizing both sides to accept a settlement. A crucial part of this peace effort could involve Russia benefiting indirectly from the next major geopolitical conflict Trump would ignite: a confrontation with Iran. By allowing high oil prices to rise amid instability in the Middle East, particularly due to a U.S.-led campaign against Iran, Russia—being one of the world’s top oil and gas producers—would gain economically. The higher revenues from these energy exports could give Moscow a strong reason to agree to peace, as it would profit from the disruptions caused by a war in Iran, even while sanctions remain in place.

A Middle Eastern Power Shift: Focus on Iran

Trump has long been an outspoken critic of Iran’s leadership, particularly the Ayatollah regime and the Islamic Revolutionary Guard Corps (IRGC). A second Trump presidency could see a much more confrontational approach toward Iran, potentially leading to military action aimed at dismantling the current regime. The goal would be to eliminate the IRGC’s influence and the ayatollah’s hold on power, perhaps by backing the exiled Pahlavi family to return to leadership and change Iran’s posture toward the West. United States Foreign policy could push for this aggressive strategy under the pretext of preventing Iran from acquiring nuclear weapons and destabilizing the region through proxy groups like Hezbollah. Eliminating Iran as a regional power would also serve U.S. interests by creating a vacuum that pro-Western forces could fill, thereby increasing America’s influence in the Middle East. Such a move would be controversial and carry enormous risks, but Trump has previously shown a willingness to disregard international criticism for what he views as strategic gains.

A Stronghold in the Middle East: Supporting Israel and Lebanon

Beyond neutralizing Iran, Trump’s broader Middle East policy could focus on weakening Hezbollah, Iran’s key ally and proxy in Lebanon. Trump has been a vocal supporter of Israel’s security and would likely see eliminating Hezbollah as a major victory for U.S. and Israeli interests. This would involve significant military and diplomatic efforts to restore a more liberal, pro-Western government in Lebanon, reminiscent of the pre-1975 Maronite Christian-led government before the Lebanese Civil War. Trump’s aim could be to return Lebanon to its former status as a more liberal, Western-leaning country, providing a buffer for Israel and reducing the influence of Hezbollah, which serves as a major threat to Israeli security. This would likely require not only military action against Hezbollah but also a significant reconstruction of Lebanon’s political system.

The end of Khameini Theocratic regime could also see Iranian civil society uprisings, driven by widespread dissatisfaction with the Ayatollah’s government, economic hardship, and increasing social unrest. The Iranian economy, already strained by mismanagement, international sanctions, and the consequences of ongoing geopolitical tensions, could lead to growing discontent that spills over into mass protests against the regime. In this context, the exiled Pahlavi family, particularly Reza Pahlavi, could play a crucial role as a unifying figure in Iran’s diplomacy. Positioned as a symbolic leader representing a secular, pro-Western alternative to the current theocratic rule, he could act as a diplomatic mediator, rallying various opposition factions, including reformists and secular groups, around a shared vision for Iran’s future. By leveraging international support for a peaceful transition, the Pahlavi family could engage in negotiations with both internal dissenters and foreign powers to achieve a shift away from the repressive policies and the fall of Ayatollah’s regime. This diplomatic strategy could create the necessary conditions to dismantle the current government and pave the way for a more democratic Iran.

Economy and Geopolitics of the Iran Conflict

A large-scale conflict with Iran would have significant repercussions on global energy markets, particularly due to Iran’s role as a major oil producer. The resulting oil shortages and price spikes would have mixed effects on global economies. While it would hurt many Western countries dependent on stable energy prices, it could serve as an economic boon for Russia. As global oil prices rise, Russia’s ability to export energy at higher prices could help offset the economic strain of its prolonged involvement in Ukraine and make a peace deal more palatable to Moscow. Gas markets would also be affected, as European countries, already strained by energy shortages due to the war in Ukraine, would have to contend with further disruptions caused by a U.S.-Iran conflict. This could increase the need for Europe’s LNG supplies from the United States, Norway, and others. The European response to this scenario would be crucial, as it could either push Europe further into energy import dependency and then force a rapid shift to alternative energy sources.

Estimating Crude Oil Market Shortfall from Iran Oil Supply Disruption

Iran is a significant player in the global energy market, especially due to its vast oil and natural gas reserves. In terms of crude oil, Iran produces around 3 million barrels per day (b/d), with exports fluctuating due to sanctions, covert trading, and political circumstances. Around 700,000 b/d of this oil is exported despite sanctions, often using smaller vessels to avoid detection. Additionally, Iran has massive natural gas reserves, second only to Russia, contributing to its strategic importance in global energy markets​(Data & analytics solutions)​(EIA Homepage).

If Iran’s offshore refineries, particularly those tied to its oil exports, were targeted in a conflict, the immediate consequence would be a significant shortfall in global oil supplies. This would likely exacerbate already tight market conditions, leading to surging oil prices. Given Iran’s current output, any major disruption could remove up to 700,000 barrels per day from the global supply chain. Such a supply shock would heighten oil price volatility, potentially pushing prices higher by $10 to $20 per barrel, depending on the duration of the disruption and global demand trends​(EIA Homepage).

Additionally, the psychological impact on the oil market could be immense, as traders and market participants would price in geopolitical risks. Europe, already vulnerable due to reliance on external energy sources, would face higher energy costs. This scenario would be used to justify energy transition narratives, including green energy investments and fiscal policies in Europe.

It could also further justify deficit spending, such as a proposed €800 billion plan for Ukraine’s reconstruction and Europe’s competitiveness​(Data & analytics solutions)​(EIAHomepage)

Energy Prices and the Green Transition Narrative

In the scenario of an escalating conflict with Iran, oil prices would likely soar, as Iran is a key oil producer and any conflict would disrupt global supplies. While this could hurt many economies, especially those dependent on stable oil and gas imports, it also provides an opportunity for Western governments to leverage the situation for domestic political purposes. High energy prices, while painful for consumers, would be spun as a necessary sacrifice on the path toward a green energy future. Western leaders, particularly in Europe, could use this opportunity to promote the narrative that the energy crisis is a direct result of fossil fuel dependency. By framing the ongoing energy shortages and price increases as a catalyst for accelerating the transition to renewable energy, governments could keep public opinion on their side, justifying continued high prices. The rhetoric would emphasize that these short-term economic pains are essential for securing long-term energy independence and environmental sustainability, shifting blame away from the geopolitical manoeuvring and onto the global energy market itself. This strategy would align with broader trends in European politics, where environmental policies and the energy transition have already become key talking points. The high oil prices resulting from the conflict with Iran would provide the perfect pretext to advance these agendas, without directly confronting the underlying causes of the price hikes. For many governments, this would be a convenient way to justify fiscal policies aimed at increasing public spending on renewable energy infrastructure and green technology.

Political Propaganda and Deficit Spending

The high oil prices and resulting energy crisis would also provide European politicians with a platform to engage in public debates and campaigns focused on the energy transition. This would serve as both a distraction from the more controversial aspects of U.S. foreign policy and a rallying point for politicians to demonstrate their commitment to solving long-term energy challenges. Political figures would have ample opportunity to frame themselves as champions of the green movement, using the crisis as a justification for increased government intervention in the energy market. At the same time, the narrative around high energy prices and the green transition could give politicians the leeway to increase fiscal deficits. With public sentiment already conditioned to accept high energy costs as an unfortunate but necessary aspect of both the Iran conflict and the transition to a sustainable future, governments would have more room to introduce expansive fiscal policies. These policies, justified as investments in green technology and infrastructure, would be framed as essential to both addressing the energy crisis and meeting climate goals. This approach would allow Western governments to run larger deficits without significant pushback, as the public would be led to believe that these are necessary steps to solve both immediate and long-term energy challenges. A settlement of the Ukraine-Russia conflict, orchestrated by shifting the focus of war toward Iran, would not only serve the strategic interests of the U.S. and Russia but would also provide ample material for Western politicians and media outlets to continue their rhetoric and propaganda. In Europe, this shift would likely open up a new debate around energy transition and, crucially, how to fund Ukraine’s reconstruction after the conflict. This would give European politicians the perfect pretext to push forward large-scale fiscal policies, including the implementation of Mario Draghi’s report on European Competitiveness. Draghi’s plan, which calls for an €800 billion fiscal package funded through debt sharing, could now be presented as both a solution to fund Ukraine’s post-war recovery and a critical investment in Europe’s energy transition. The necessity to rebuild Ukraine, coupled with the high energy prices caused by the conflict in Iran, would be framed as justification for this ambitious fiscal expansion. This would not only align with the green energy rhetoric but would also serve as a tool for European leaders to push for greater economic integration and competitiveness. Politicians and media commentators could use these talking points to fill the public debate, effectively distracting the masses from the underlying economic strains caused by war and energy shortages. In this scenario, propaganda would be functional to keep the focus on long-term goals like energy transition and competitiveness, all while making massive public spending and debt-sharing seem both necessary and inevitable.

Keeping Politicians Talking Heads in Line

The political class would have much to gain from this scenario. Western politicians, particularly in Europe, could position themselves as defenders of both the environment and national security. With the Iran conflict serving as a backdrop, they would be able to use the crisis to reinforce the message that the energy transition is not just an environmental necessity, but a geopolitical imperative. This would allow them to maintain their relevance in the public discourse, rallying support for policies that would otherwise be seen as politically risky. Moreover, this scenario would keep political “talking heads” on message, ensuring that debates remain focused on the energy transition and away from more inconvenient topics, such as the economic fallout of a large-scale war in the Middle East. The narrative of green energy would dominate public discussions, with politicians and media outlets amplifying the idea that high energy prices are a temporary hurdle on the path to a sustainable future. This focus on green energy would also serve as a tool for governments to control the narrative, minimizing the attention on the economic consequences of the conflict in Iran or the peace settlement in Ukraine that might benefit Russia.

A Bold, Risky Strategy with Global Implications

Trump’s potential foreign policy, particularly in the context of a conflict with Iran, could serve as more than just a geopolitical power play. It could covertly establish a framework for Western governments to justify sustained high energy prices and accelerate the energy transition, all while maintaining public support through carefully crafted narratives. By keeping the public focused on the green transition, politicians would have the space to engage in deficit spending, advance fiscal policies under the guise of environmentalism, and deflect from the broader economic consequences of the conflict. In the end, this could ensure that Western populations continue to bear the financial burden, while political leaders remain insulated by their control over the public discourse. The mass-media propaganda setup would see similar rhetoric on both sides of the Atlantic, while the Republican party and the Trump Presidency would argue for more fossil fuel and shale gas financing, the European Union and governments will have to push for Green Energy transition and Renewable energy investments financing, opening the pandora box for Europea Union €800 billion competitiveness Fiscal package based on Euro Area debt sharing issuance and ESG Green Bonds issuance.

A Trump foreign policy focused on resolving the Ukraine-Russia conflict and reshaping the Middle East would be bold and fraught with risks. It would represent a dramatic departure from the multilateral approaches of previous administrations, relying instead on brinkmanship and leveraging geopolitical conflicts for economic and strategic gains. The potential rewards—a peace settlement in Ukraine, a weakened Iran, and a stronger U.S. foothold in the Middle East—would be significant. However, the risks of destabilizing the region further and alienating key allies could lead to unpredictable consequences. Nevertheless, Trump’s history suggests he might be willing to take those risks in pursuit of his vision for reshaping U.S. foreign policy.

Read More:

Ukraine-Russia Conflict

• The Potential for Peace in Ukraine: Analysis and Implications (Foreign Affairs)

Iran and U.S. Relations

• The U.S. and Iran: A Long and Complicated History (C-SPAN)

Oil Prices and Global Markets

• Global Oil Prices and Geopolitical Risks: An Analysis (ECB)
• Experts React: Energy Implications of Escalating Middle East Conflict
• OilMarketReport.pdf

Economic Implications of Military Conflicts

• Economic Impacts of War: An Overview (IMF)
• The Long-lasting economic shock of war