Analysis: What Will Iran Do Next

On February 28, 2026, the United States and Israel launched a massive combined military operation against Iran — an assault that killed Supreme Leader Ali Khamenei, devastated nuclear facilities, and plunged the Middle East into its most dangerous crisis in decades. Eleven days later, with crude oil surpassing $100 a barrel, the Strait of Hormuz effectively shut down, and a new supreme leader installed amid the rubble of Tehran, one question dominates global security discussions: What will Iran do next?

The answer is emerging in real time — and it is more complex, more dangerous, and more consequential than many in Washington anticipated.

From Negotiations to War in Ten Days

The speed of the escalation is staggering. As recently as February 26, the third round of indirect US-Iran nuclear talks was underway in Geneva, mediated by Oman's Foreign Minister Badr Albusaidi [1]. Iranian Foreign Minister Abbas Araghchi had declared that a "historic" agreement was "within reach" [2]. The Americans and Iranians were talking — indirectly, through Omani intermediaries, but talking nonetheless — about uranium enrichment caps, ballistic missiles, and sanctions relief.

Then, on February 20, President Donald Trump issued a 10-day ultimatum: reach a deal or face military consequences [3]. The talks in Geneva ended without agreement. According to Bloomberg, the Americans left disappointed with the results, while Secretary of State Marco Rubio told reporters that "Iran refuses to talk about ballistic missiles, to the US or to anyone, and that's a big problem" [4].

Eight days later, the bombs began to fall.

The Assassination of Khamenei and a Dynastic Succession

The February 28 strikes were designed to be decapitating. Among the targets was Supreme Leader Ali Khamenei himself, whose death was confirmed by Iranian state media on March 1 [5]. The US military's Central Command reports it has struck more than 3,000 targets in Iran and destroyed 43 Iranian warships since the operation began [6].

The leadership vacuum lasted just over a week. On March 8, the Assembly of Experts elected Mojtaba Khamenei — the late supreme leader's 56-year-old son — as Iran's third supreme leader [7]. The appointment was deeply ironic: Ali Khamenei himself had reportedly been "deeply opposed" to his son's succession, fearing it would evoke a monarchy-like structure antithetical to the Islamic Republic's founding ideology [8].

Mojtaba, a mid-ranking cleric with close ties to the Islamic Revolutionary Guards Corps, had long wielded influence behind the scenes — from "crushing dissent to influencing presidential elections," according to analysts [7]. His elevation signals that the IRGC hardliners now have a direct grip on the supreme leadership, which carries profound implications for Iran's wartime decision-making.

Israel has made clear it views no successor as legitimate. The IDF stated on X/Twitter that "the hand of the State of Israel will continue to pursue every successor and every person who seeks to appoint a successor" [9].

Iran's Military Response: The "Mosaic Defense"

Rather than capitulating, Tehran has chosen escalation. Iran has fired over 500 ballistic and naval missiles and almost 2,000 drones since February 28, according to Iran's Fars News Agency [6]. But the most consequential strategic move has been the activation of what Iranian military planners call "mosaic defense" — a decentralized doctrine that grants individual commanders autonomy to sustain operations even if cut off from central command [10].

This approach reflects lessons learned from the 2025 Twelve-Day War with Israel, in which Iran's centralized command structure proved vulnerable to targeted strikes. Under the new doctrine, regional commanders and proxy networks can continue fighting independently, making a knockout blow far more difficult for the US and Israel to deliver.

Source: GDELT Project

Data as of Mar 10, 2026CSV

The Strait of Hormuz: Iran's Most Powerful Weapon

Perhaps Iran's most consequential decision has been the effective closure of the Strait of Hormuz — the narrow waterway through which roughly 20 million barrels of oil pass daily, representing approximately 20% of global seaborne oil trade [11].

Within hours of the first strikes, the IRGC transmitted warnings via VHF radio to vessels in the strait, stating that no ships would be permitted to pass [12]. By March 2, a senior IRGC official confirmed the strait was "closed" [12]. Although Iran did not formally declare a legal blockade, the effect has been the same: tanker traffic initially dropped by approximately 70%, with over 150 ships anchoring outside the strait, and soon traffic fell to near zero [13].

The economic consequences have been immediate and severe. Brent crude surpassed $100 a barrel on March 8 for the first time in over three years, at one point topping $119 [14]. The average price of gasoline in the United States reached $3.45 a gallon, up 16% in a single week [15]. Major oil producers including Iraq, Kuwait, and the UAE have been forced to cut production because they are running out of storage space, unable to export through the strait [14].

Source: FRED / U.S. Energy Information Administration

Data as of Mar 4, 2026CSV

This is the nightmare scenario that energy analysts have warned about for years — and it is now unfolding. Trump has floated the possibility of the US "taking over" the Strait of Hormuz, a statement that has alarmed Gulf Arab states [16].

The Proxy Network: Bruised but Not Broken

Iran's constellation of regional allies — the so-called "Axis of Resistance" — has been activated, but unevenly [17].

Hezbollah entered the conflict on March 2, firing rockets into northern Israel and prompting Israeli retaliatory strikes in Lebanon that have killed more than 200 people [6]. However, Hezbollah's capabilities are diminished after the sustained Israeli campaign of 2024-2025 that killed Secretary-General Hassan Nasrallah and much of the group's senior leadership. Under his successor Naim Qassem, the organization has rebuilt some combat capability, but its arsenal is depleted and its political standing in Lebanon is strained [17].

The Houthis represent Iran's most resilient proxy. Ansar Allah controls large swaths of Yemen, has survived US, British, and Israeli strikes, and continues to disrupt Red Sea shipping. Crucially, the Houthis have begun manufacturing arms domestically, reducing their dependence on Iranian supply lines — a development that makes them simultaneously more dangerous and less controllable [18].

Iraqi militias have been largely rhetorical in their response, constrained by domestic politics and limited capabilities relative to US forces in the region. Their response has consisted mainly of "face-saving strikes" rather than any sustained offensive [17].

The broader picture is one of a proxy network that is "bruised and fragmented, but also more decentralized, more ideological, and less responsive to Iranian control" [17]. This creates a paradox: Iran's allies are less capable of executing coordinated strategy, but also less susceptible to being shut down through diplomatic pressure on Tehran.

The Nuclear Question

The status of Iran's nuclear program amid the current conflict remains opaque — and alarming. Before the war, Iran had accumulated significant quantities of uranium enriched to 60% U-235, which is near the 90% weapons-grade threshold [19]. Iranian officials have stated that enrichment has ceased due to damage inflicted on facilities at Natanz and Fordow [19].

On March 3, the IAEA confirmed that while strikes had failed to destroy the Natanz nuclear facility outright, significant damage to entrance buildings had rendered it inaccessible [20]. Tehran has allowed IAEA inspectors to return to undamaged facilities such as the Bushehr reactor, but has refused access to damaged sites or information about the disposition of its enriched uranium stockpile [20].

This lack of transparency is deeply concerning to nonproliferation experts. If Iran's enriched uranium survived the strikes — and there is no confirmation that it was destroyed — the Islamic Republic retains the theoretical capability to produce weapons-grade material should it choose to do so. The appointment of the IRGC-aligned Mojtaba Khamenei as supreme leader only heightens these concerns.

Economic Devastation and the Question of Endurance

Iran entered this war in the midst of its deepest economic crisis in modern history. The Iranian rial has collapsed from approximately 42,000 to over 1.1 million against the US dollar [21]. Inflation hit 48.6% in October 2025 and 42.2% in December 2025 [21]. The reimposition of US sanctions since 2018 had already slashed oil exports by 60-80%, stripping the government of tens of billions in annual revenue [22].

The World Bank projected before the war that Iran's GDP would contract by 2.3% on average across 2025-2027, with inflation approaching 60% [23]. The current military campaign will deepen these trends dramatically.

Yet Iran's leaders appear to calculate that economic pain is survivable if it can inflict sufficient costs on its adversaries. The Strait of Hormuz closure is the clearest expression of this logic: Tehran may be destroying its own export capacity, but it is also paralyzing global energy markets and imposing massive costs on Western economies and Gulf Arab neighbors.

What Comes Next: Three Scenarios

Scenario 1: Protracted Attrition. The most likely near-term trajectory. Iran continues its decentralized resistance, maintains the Hormuz blockade, and leverages its proxy network to impose costs across the region. The US and Israel continue strikes but find that a ground invasion — which Iran's Foreign Minister Araghchi has said Iran is "confident" it could resist [24] — carries prohibitive risks. Oil prices remain elevated, creating political pressure on Western governments. This is a war of endurance, and Iran bets that its tolerance for suffering exceeds Washington's tolerance for economic pain.

Scenario 2: Negotiated Ceasefire. China has sent a special envoy to mediate [25], and behind-the-scenes diplomatic channels remain active. However, the obstacles are formidable. Trump demands "unconditional surrender" [26], which no Iranian government — least of all one led by a hardline new supreme leader legitimized through martyrdom — can accept. Iran's FM Araghchi has stated: "Unless we get a permanent end to the war, I think we need to continue fighting for the sake of our people and our security" [24]. A ceasefire would require both sides to step back from maximalist positions — something neither appears willing to do in March 2026.

Scenario 3: Wider Regional War. The conflict has already expanded into Lebanon and disrupted Gulf state operations. If Houthi attacks on Red Sea shipping intensify, or if Iraqi militias move beyond rhetoric to sustained operations against US forces, the war could metastasize into a region-wide conflagration. The US ordering staff to leave Saudi Arabia is an ominous signal [25]. OPEC+ has already boosted output to compensate for disrupted Iranian and Gulf production, but the market is strained [27].

The Calculation in Tehran

Iran's leaders — now consolidated around the IRGC-backed Mojtaba Khamenei — appear to have concluded that the era of "strategic patience" is over [10]. For years, Iran absorbed strikes on its commanders, its nuclear scientists, and its proxies while pursuing diplomatic solutions. The February 28 attack, which killed the supreme leader himself, crossed a threshold from which there is no return to that posture.

The Islamic Republic's strategy is now one of maximum cost imposition: close Hormuz, activate every available proxy, endure the bombing campaign, and bet that the economic and political costs of a prolonged war will force the United States and Israel to the negotiating table on terms Iran can accept.

Whether that gamble succeeds depends on variables that remain deeply uncertain: the durability of Iranian command structures under sustained bombardment, the willingness of Gulf states to resist US pressure, China's appetite for mediation, and the tolerance of the American public for a war that is already reshaping the global economy. What is clear is that Iran has made its choice: it will fight.

Source: Crowdbyte analysis of multiple sources

Data as of Mar 10, 2026CSV