US Seeks War Funding, Arabs Count Losses

 

Strategic divergence widens as Gulf economies weigh the cost of conflict over the logic of confrontation

The suggestion by Donald Trump that Arab countries should help finance the war against Iran reflects a familiar instinct in Washington: externalize the financial burden while retaining strategic command. Yet, this proposition is increasingly at odds with shifting regional priorities.

According to White House spokesperson Karoline Leavitt, the idea is not merely rhetorical but rooted in the President’s thinking. This comes at a time when Washington claims that negotiations with Tehran are progressing, even as it threatens to target Iran’s energy infrastructure. Such dual signaling—diplomacy on one hand and coercion on the other—highlights a policy struggling to reconcile intent with outcome.

For decades, the United States has framed Iran as the principal destabilizing force in the region, often in strategic alignment with Israel. That narrative is no longer universally compelling across Arab capitals. The issue is not the absence of concern about Iran, but the rising cost of confrontation.

Three realities now shape the regional calculus.

First, the ongoing conflict is widely perceived as emerging from a convergence of US-Israeli strategic interests, despite visible unease among several Gulf states. This perception complicates efforts to build financial or political backing for prolonged military engagement.

Second, the credibility of US security guarantees has come under scrutiny. Strategic installations in countries hosting American bases have faced vulnerabilities, raising questions about the reliability of external protection. If security assurances appear uncertain, underwriting conflict becomes a harder sell domestically.

Third, and most decisively, the economic fallout is being borne disproportionately by Arab economies. The disruption of the Strait of Hormuz—a critical artery for global oil shipments—has directly impacted revenues, trade flows, and fiscal stability across the Gulf. For these states, the war is not an abstract geopolitical contest but an immediate economic strain.

Even within Washington, strategic clarity remains elusive. While Trump speaks in terms of near-accomplished “regime change,” Marco Rubio has cautioned that outcomes remain uncertain. This internal divergence weakens the case for burden-sharing and raises concerns about long-term policy direction.

The emerging divide is therefore subtle but significant. Arab states are not dismissing security concerns, but they are increasingly prioritizing economic stability and regional de-escalation over alignment with an open-ended conflict.

In this evolving landscape, one reality stands out: while Washington may seek partners to fund its war, Arab states—already counting the losses—are far less inclined to underwrite it.

Who should be blamed for the closure of Strait of Hormuz? Iran or United States

The closure of the Strait of Hormuz has sent shockwaves across global markets, but the deeper question is unavoidable: what led to this point of no return?

The answer lies not in a single act, but in a sequence of decisions that began with the use of force at a moment when diplomacy was still in motion. Reports indicate that while negotiations were ongoing, the United States and Israel carried out strikes against Iranian targets. In geopolitical terms, such actions do not merely apply pressure—they fundamentally dismantle the diplomatic track.

When dialogue is replaced by force, retaliation becomes a predictable outcome. The response from Iran must be viewed within this context. Faced with attacks on its strategic installations and the killing of key leadership figures, Iran signaled clearly that it would respond—and that certain red lines, once crossed, would trigger consequences.

The closure of the Strait is not an impulsive decision. It is a calculated assertion of leverage. Geography is Iran’s strongest strategic asset, and in moments of existential pressure, it becomes the tool through which power is projected. By announcing conditions for maritime passage, Iran has reinforced that this is not chaos, but controlled pressure in response to external actions.

To place responsibility squarely where it belongs: this crisis did not emerge from Iran acting in isolation—it was set in motion by those who chose escalation over negotiation. The moment diplomacy was interrupted by strikes, the trajectory toward confrontation became unavoidable.

Compounding the situation is the rhetoric emanating from Washington, including calls for “unconditional surrender.” Such language is not just diplomatically unhelpful—it is strategically counterproductive. It removes space for compromise and signals an approach rooted in dominance rather than resolution.

The Strait of Hormuz, through which a significant portion of global energy flows, has now become the epicenter of a crisis that could have been avoided. The disruption we are witnessing is not the starting point—it is the consequence.

Who Truly Dominates the Arabian Peninsula?

The idea of a “superpower” in the Arabian Peninsula is often shaped by wealth, alliances, and perception. Remove external backing—particularly that of the United States—and the equation changes dramatically. What remains is a test of self-reliance, endurance, and the ability to fight alone.

At first glance, Saudi Arabia appears dominant. With one of the world’s largest defense budgets and a formidable arsenal of advanced aircraft and missile systems, it projects overwhelming strength. Yet this power is structurally dependent. Its military ecosystem relies heavily on imported platforms, foreign maintenance, and external logistical support. Without these, its technological edge risks rapid erosion.

Qatar, though financially powerful, lacks strategic depth. Its military is modern but limited in size and sustainability. In a prolonged conflict without external guarantees, it cannot realistically compete for regional military supremacy.

Turkey presents a more complex case. Though geographically outside the Arabian Peninsula, its influence is undeniable. It combines a large standing army with a growing indigenous defense industry, particularly in drones and naval assets. Unlike Gulf states, Turkey possesses the capacity to produce and adapt independently. However, its strategic priorities are divided across multiple theaters, diluting its focus on the Gulf.

This leaves Iran—a country long constrained by sanctions, yet shaped by them. Before the recent one-month war, Iran’s strength lay in its missile arsenal, dispersed military infrastructure, and doctrine of asymmetric warfare. It was built not to dominate, but to deter through the certainty of retaliation.

One month of sustained conflict has altered—but not erased—this reality. Iran’s military infrastructure has been significantly degraded. Missile sites, production facilities, and air defenses have suffered visible damage. By conventional metrics, it is weaker today than it was at the outset.

Yet the defining outcome lies elsewhere.

Despite these losses, Iran continues to operate, retaliate, and maintain strategic coherence. Its domestically sustained and decentralized military architecture has allowed it to absorb sustained strikes without collapsing. The objective of decisively neutralizing it remains unmet.

The conclusion is therefore unavoidable. In a no-alliance scenario, power is not measured by what survives untouched, but by what continues to function under fire. Iran emerges not as the strongest because it is unscathed, but because it has proven it cannot be decisively subdued.

Between Exit and Escalation: A War Slipping Beyond Control

The evolving US-Israeli war on Iran has pushed Donald Trump into a strategic trap—one defined not by a lack of power, but by a lack of viable options. What was conceived as a limited campaign to reassert deterrence is steadily transforming into a conflict that resists containment, reshapes global markets, and erodes political capital at home. 

A month into the war, the contradictions are stark. Washington sought a short, decisive engagement; instead, it faces a resilient Iran that has shifted the battlefield from military confrontation to economic disruption. By tightening pressure on the Strait of Hormuz and sustaining missile and drone operations, Tehran has leveraged geography and endurance to impose costs far beyond the immediate theatre of war.

The consequences are already visible. Rising global energy prices are no longer an externality—they are a direct political liability. For an administration navigating fragile domestic support, the economic ripple effects risk becoming more damaging than the conflict itself. Approval ratings slipping into dangerous territory underscore a deeper problem - this war is losing its political legitimacy at home even as it remains strategically unresolved abroad.

This leaves Trump with choices that are stark but deeply constrained. A negotiated exit appears increasingly elusive. Diplomatic overtures, including reported backchannel proposals, demand concessions that Iran has historically rejected. Even if a deal were reached, it would likely be seen as a retreat—undermining the very premise on which the war was launched.

Escalation, meanwhile, carries even greater risks. Expanding military operations or deploying ground forces could entangle the United States in a prolonged conflict—precisely the kind Trump has repeatedly vowed to avoid. The shadow of past wars in Iraq and Afghanistan looms large, not just in strategic calculations but in public memory. Any move in that direction risks accelerating domestic backlash and fracturing political support.

Analysts such as Jonathan Panikoff have pointed to a fundamental flaw: the absence of a clearly defined and achievable endgame. Without clarity on what constitutes success, each tactical move risks deepening strategic ambiguity.

Meanwhile, as Jon Alterman notes, Iran’s strategy appears rooted in a far simpler objective—endure and outlast. In such a framework, survival itself becomes victory.

This asymmetry is critical. The United States seeks a decisive outcome; Iran seeks persistence. The longer the conflict continues, the more it reinforces the perception that time is not on Washington’s side. Every passing week tightens the strategic bind, amplifying economic disruption, unsettling allies, and testing domestic patience.

Trump’s shifting signals—alternating between threats of escalation and gestures toward diplomacy—reflect an attempt to manage this narrowing space. But such contradictions, while tactically useful, risk creating uncertainty among allies and markets alike.

As Laura Blumenfeld observed, this “fog of war” messaging may keep adversaries guessing, but it also underscores the absence of a coherent pathway forward.

What began as a war of choice is edging toward a loss of control. The longer the conflict persists, the narrower Washington’s options become—diplomacy without leverage, escalation without certainty, and a domestic landscape growing increasingly unforgiving. 

This is no longer about achieving decisive victory; it is about managing the consequences of a strategy that has outpaced its own assumptions. For Trump, the dilemma is no longer theoretical. It is immediate, structural, and tightening by the day.

PSX Benchmark Index Down 0.68%WoW

Pakistan Stock Exchange (PSX) witnessed persistent volatility during the week, mainly shaped by Middle-East conflict and resulting fluctuations in international oil prices. The benchmark index registered erosion of 1,033 points or 0.68%WoW to close at 151,708 on Friday, March 27, 2026.

Week began on a positive note, supported by emerging de-escalation efforts with Pakistan acting as a mediator; however, gains were eroded in last two trading sessions as conflicting statements from the United States and Iran heightened uncertainty.

On the domestic macro front, cut-off yields in Thursday’s PIB auction increased by 90-225bps, with 5-year paper yield rising to 12.5%.

Moreover, Barrick Mining Corp extended the review period of Reko Diq by 12 months in light of ongoing Middle East conflict and escalation of domestic security issues. The aforesaid developments weighed on Bank and E&P sectors.

IMF shared MEFP draft with Pakistan, marking progress towards SLA for third review.

Amid the ongoing energy situation, GoP reduced the PSDP allocation by PKR100 billion to accommodate fuel subsidies, to maintain domestic petroleum prices in last two reviews, with an estimated two-week cost of PKR69 billion.

Market participation rebounded post-Ramadan, with average daily traded volumes surging to 872 million shares from 418 million shares in prior week.

Foreign exchange reserves held by State Bank of Pakistan (SBP) increased by US$22 million to US$16.4 billion as of March 18, 2026.

Other major news flow during the week included: 1) Pakistan secures petroleum cargoes till April 25, 2) Foreign assistance inflows were up 18.35%YoY to US$5.862 billion during 8 months of current financial years 3) NEPRA okays competitive bidding for power supply, and 4) Domestic cotton prices jump sharply amid Middle East crisis.

Top performing sector of the week were Technology, Inv. Banks, and Cements while laggards included Refinery, Power, and E&P.

Major selling was recorded by Insurance and Banks with a net sell of US$12.5 million and US$6.8 million, respectively. Individuals absorbed most of the selling with a net buy of US$20.0 million.

Top performing scrips of the week were: SYS, PGLC, INIL, BNWM, and PIBTL, while laggards included: KTML, SSGC, KEL, SAZEW, and GAL.

Going forward, market sentiment will hinge on developments of the Middle East conflict. At the same time, investor focus will remain on the government’s energy conservation measures, diversification of fuel imports, and progress on the IMF review.

According to AKD Securities, over the medium term, any de-escalation in the conflict could spark a strong market rebound, as recent corrections have made valuations more attractive, with forward P/E now at 6.4x.

Top picks of the brokerage house include: OGDC, PPL, UBL, MEBL, HBL, FFC, ENGROH, PSO, LUCK, FCCL, INDU, ILP and SYS.

US–Israel War on Iran: Dominance Under Question

The brief but intense confrontation between the United States, Israel, and Iran in June 2025—lasting barely twelve days—was projected as a calibrated show of force. Officially concluded as a ceasefire, the episode aimed to restore deterrence and reset strategic equations. Yet, nearly nine months later, the outcomes appear far less definitive than anticipated.

At the time, negotiations over Iran’s nuclear program were reportedly progressing. The sudden escalation suggested a shift from diplomacy to coercion, widely interpreted as an attempt—driven in part by Israeli pressure—to achieve multiple objectives: degrade Iran’s strategic infrastructure, weaken its regional posture, and potentially trigger internal instability. None of these goals, however, seem to have been fully realized.

There is little doubt that Iran’s strategic installations suffered damage. However, the broader political and military picture is more nuanced. The Iranian regime has remained intact, and domestic cohesion appears to have strengthened rather than fractured. External pressure, instead of splintering the state, may have reinforced national resolve—an outcome not unfamiliar in modern conflict settings.

Equally significant is the perceptual shift. The image of unquestioned military supremacy long associated with the United States and Israel appears to have been dented. Iran’s ability—both real and projected—to respond through retaliatory actions against regional targets and US-linked assets has complicated the narrative of one-sided dominance.

Reports and claims emerging from the conflict add further complexity. Iranian officials have asserted successful targeting of military assets and bases, while some unverified accounts point to disruptions in logistical and maritime supply lines, including incidents in strategically sensitive waterways and installations in the broader Indian Ocean region. While these claims remain contested, they nonetheless contribute to a narrative of reach and resilience that Tehran appears keen to project.

The latest signals from Donald Trump—indicating a pause or deferral in further strikes on Iran’s strategic assets—have deepened speculation. This could reflect tactical recalibration, but it also raises the possibility of operational limits rather than purely strategic choice. In contemporary conflict, pauses often reveal as much as offensives.

What emerges, therefore, is not a clear victory for any side, but a reminder of limits. Military power, even when overwhelming, does not automatically translate into decisive political outcomes. Short wars can disrupt, degrade, and demonstrate—but they rarely resolve deeply embedded strategic rivalries.

For Iran, the ability to absorb pressure and maintain internal stability can be framed as a form of strategic endurance. For the United States and Israel, the episode underscores the complexity of converting battlefield advantage into lasting geopolitical gains. The balance of power may not have fundamentally shifted—but its boundaries have certainly been tested.

In the end, the twelve-day war—and the weeks that followed—reinforce a familiar lesson - in geopolitics, outcomes are rarely as clear-cut as intentions.

Over One Million Americans Say Impeach and Remove Trump

The legal advocacy organization Free Speech for People on Thursday published a full-page advertisement in The New York Times highlighting the more than one million people who have endorsed the group’s petition to impeach and remove President Donald Trump from office.

Free Speech for People’s (FSFP) campaign—which also includes billboard trucks and projections in Washington, DC—comes ahead of the third wave of “No Kings” demonstrations, which are set to take place Saturday in thousands of locations across the United States.

“On March 28, 2026, the people will rise up,” said FSFP digital organizing strategist Jax Foley. “The No Kings 3 protest is projected to be the largest mass comobilization in US history, with over 3,000 actions planned worldwide. People across this country are organizing, mobilizing, defending their communities, and demanding accountability.”

No Kings 3 comes amid Trump’s attacks on the rule of law and constitutional rights at home and escalating militarism abroad as the president has bombed seven countries since returning to office—and 10 or possibly even 11 over the course of his two terms—while backing Israel’s genocidal war on Gaza.

“Donald Trump poses a direct threat to our Constitution and to the rule of law,” FSFP president and co-founder John Bonifaz said in a statement. “The constitutional remedy of impeachment exists precisely for moments like this when a president abuses power, defies the law, and attacks democracy itself. Congress must act.”

FSFP’s petition, which was launched on the day of Trump’s second inauguration, urges Congress to “take action to defend our republic and Constitution” by impeaching the president again. As of Thursday afternoon, the petition had over 1,070,000 signatures and is more than halfway to its goal of 2 million signers.

“For more than a year, FSFP’s team of lawyers, election security experts, and grassroots organizers have been tirelessly and fiercely leading the campaign to impeach and remove Trump and key administration officials,” Foley said. “We have heard from people across the United States who are with us in the call for no kings, no tyrants, and the immediate impeachment and removal of Trump and his coconspirators. Put the power back in the hands of We The People.”

Trump is the only US president to be impeached twice—once in 2019 for abuse of power and obstruction of justice and again in 2021 for incitement of insurrection. A majority of senators voted to acquit Trump in 2019; a majority—but not the requisite two-thirds—voted to convict in 2021. Both chambers of Congress are now narrowly controlled by Trump’s GOP.

“The congressional power of impeachment is designed to address this tyrannical threat to our democracy,” FSFP said in the New York Times ad. “Members of Congress must abide by their oath to protect and defend the Constitution and impeach and remove Trump from office.”

Courtesy: Common Dreams