The Lawfare Podcast · The Lawfare Institute

Lawfare Daily: The Gulf Widens

March 24, 2026·51 min·5 clips

Elisa Catalano points out the irony of the U.S. considering lifting Iranian oil sanctions during a war to pressure Iran.

This episode of the Lawfare Podcast features host Ariane Tabatabai in conversation with Elisa Catalano Schiano di Pepe, a senior fellow at the Council on Foreign Relations, about the implications of the U.S.-Israeli war with Iran for the broader Gulf region, now approximately three weeks into active conflict. Catalano begins by explaining that Iran's response to U.S.-Israeli strikes on its territory has unfolded predictably. While Iran cannot match conventional U.S. military power, the IRGC has spent decades building asymmetric capabilities. Iran has disrupted freedom of navigation in the Strait of Hormuz, conducted airstrikes, missile strikes, and drone strikes on U.S. facilities and embassies in the region, and hit energy and tourism infrastructure of neighboring Gulf states. Critically, Iran has managed to threaten the strait while still moving its own tankers and preferred commercial vessels through, lowering its costs while raising them for everyone else. The hosts discuss the administration's failure to anticipate the severity of strait disruptions despite decades of scenario planning and red-teaming that consistently identified this as Iran's top asymmetric response. Catalano argues the problem is not in modeling but in a failure to take existing analysis seriously, with the administration focused on military success at the expense of strategic outcomes. On potential exit ramps, Catalano notes that the president could end the war at any point, but popular opinion, economic costs (oil at $119, budget requests rising from $50 billion to $200 billion in weeks), and political context have not yet individually motivated a change. The administration's consideration of unsanctioning Iranian oil to stabilize prices mirrors its earlier approach with Russian sanctions, but neither that nor releasing strategic reserves has calmed markets. Beyond oil, dozens of commercial vessels are trapped in the Persian Gulf carrying helium, aluminum, and fertilizer precursors, creating environmental and supply chain risks. The conversation examines Israeli objectives, which differ from U.S. goals. Israel is focused on eliminating the existential threat cloud from Iran through a combined capabilities-destruction and leadership-decapitation campaign designed to create internal chaos. Catalano notes that Israel is less concerned about potential Iranian state breakdown than Gulf partners are, since a regime in crisis is one focused inward rather than on Israel. On the Abraham Accords, Catalano argues that removing the Iranian threat does not automatically normalize Israel-Gulf relations because the unresolved Palestinian question remains existential for the Arab and Muslim world, and the current Israeli government shows no interest in addressing it. European allies are navigating competing pressures: no love for the Iranian regime, but discomfort with a war they see as lacking international legal foundation, compounded by recent U.S. threats against European territory. Europe is contributing to Gulf defenses and Mediterranean security but on its own terms, not under the U.S.-led construct the president has proposed. The hosts note that European capitals have been increasingly vigilant about IRGC cells and terrorism threats on their soil. Regarding Asia, the removal of THAAD from South Korea and a Marine Expeditionary Unit from Japan to support the Iran campaign signals diminished U.S. focus on Indo-Pacific deterrence. Japan's prime minister's visit was partly about investing in the long-term alliance relationship. China has managed to get its tankers through the strait and has substantial oil storage, reducing its economic pressure. Beijing has called for de-escalation but shown little willingness to mediate, and may bear responsibility for providing precursors that helped Iran reconstitute ballistic missile capabilities after the previous year's 12-day war. The discussion closes with the costs of the war to U.S. military readiness: every interceptor and precision munition used has a six-month to one-year replacement timeline, and adversaries including China are learning from the unprecedented display of U.S. capabilities.

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