Israel launches attack against Iran

According to Reuters report, Israel has launched attack against Iran on Saturday, pushing the Middle East into a renewed military confrontation and further dimming hopes for a diplomatic solution to Tehran's long-running nuclear dispute with the West.

The New York Times, citing a US official, reported that US strikes on Iran were underway. A source told Reuters that Iran's supreme leader, Ayatollah Ali Khamenei, was not in Tehran and had been transferred to a secure location.

The attack, coming after Israel and Iran engaged in a 12-day air war in June, follows repeated U.S.-Israeli warnings that they would strike again if Iran pressed ahead with its nuclear and ballistic missile programs.

"The State of Israel launched a pre-emptive attack against Iran to remove threats to the State of Israel," Defence Minister Israel Katz said.

Explosions were heard in Tehran on Saturday, Iranian media reported.

The US and Iran renewed negotiations in February in a bid to resolve the decades-long dispute through diplomacy and avert the threat of a military confrontation that could destabilize the region.

Israel, however, insisted that any US deal with Iran must include the dismantling of Tehran's nuclear infrastructure, not just stopping the enrichment process, and lobbied Washington to include restrictions on Iran's missile program in the talks.

Iran said it was prepared to discuss curbs on its nuclear program in exchange for lifting sanctions but ruled out linking the issue to missiles.

Tehran also said it would defend itself against any attack.

It warned neighbouring countries hosting US troops that it would retaliate against American bases if Washington struck Iran.

In June last year, the US joined an Israeli military campaign against Iranian nuclear installations, in the most direct American military action ever against the Islamic Republic.

Tehran retaliated by launching missiles toward the US Al Udeid air base in Qatar, the largest in the Middle East.

Western powers have warned that Iran's ballistic missile project threatens regional stability and could deliver nuclear weapons if developed. Tehran denies seeking atomic bombs.

Pakistan’s Western Front: Security First, Escalation Last

The latest flare-up between Pakistan and Afghanistan is not about ideology, nor about religion. It is about security — plain and simple. For Islamabad, the issue is whether militant groups hostile to Pakistan can operate from across the border with impunity.

Pakistan’s position is rooted in sovereignty. No state can allow armed actors to use neighboring territory as a launching pad for attacks. Islamabad has consistently maintained that elements targeting Pakistan have found operational space inside Afghanistan since the return of the Taliban government in 2021. Kabul rejects this claim, arguing that Pakistan is deflecting from its internal security challenges. This divergence is not new — but it is now sharper and more dangerous.

The recent Pakistani air operations inside Afghan territory must be seen through this security prism. Islamabad describes them as targeted actions against militant infrastructure, not as aggression against the Afghan state. The subsequent retaliation along the border elevated tensions to a level that Pakistan’s Defence Minister, Khawaja Muhammad Asif, termed “open war.” That phrase reflects gravity, not intent for prolonged conflict.

The response from the US Department of State — supporting Pakistan’s right to defend itself while expressing concern over casualties — adds geopolitical context but does not define Pakistan’s policy. Islamabad’s western border challenges are indigenous and longstanding. These predate Washington’s statements and will persist independent of them.

Strategically, Pakistan faces a classic security dilemma. If it acts, it risks escalation. If it does not act, it risks emboldening militant actors. Neither option is cost-free. However, sustained instability on the western frontier would divert resources from Pakistan’s primary priority - economic stabilization and internal reform.

It is also important to recognize what this confrontation is not. It is not a war for territory. It is not a regime-change project. And it is not in Pakistan’s interest to see Afghanistan destabilized. A chaotic Afghanistan historically produces security spillovers into Pakistan. Stability in Kabul, therefore, is aligned with Islamabad’s long-term interests — provided that stability does not come at the cost of Pakistani lives.

The way forward demands firmness without adventurism. Pakistan must continue to defend its sovereignty while keeping diplomatic channels functional. Structured border mechanisms, verifiable counterterrorism cooperation, and sustained political engagement are essential.

For Pakistan, the equation is straightforward: security first, escalation last. Strategic maturity lies in deterring threats without sliding into prolonged confrontation. The western border must not become a permanent battleground — it must become a managed frontier built on accountability and realism.

PSX benchmark index down 2.9%WoW

Pakistan Stock Exchange (PSX) continued to witness volatility during the week amid persistent geopolitical tensions between the US and Iran, alongside Pak-Afghan conflict, before staging a recovery on Thursday with a gain of 4,267 points. The benchmark index declined by 5,108 points or 2.9% during the week, closing at 168,062 on Friday, February 27, 2026. Market participation improved during the week, with average daily traded volumes rising by 25%WoW to 1.0 billion shares, from 831 million shares a week ago.

On the macro front, developments remained supportive, with the IMF review team currently in the country. In parallel, the Finance Minister’s remarks regarding the UAE’s US$2 billion loan rollover were also encouraging, providing comfort on the country’s external financing position.

Moreover, SBP’s net FX intervention reached US$11 billion over the last 18 months as of November 2025, while SBP held FX reserves increased by US$16 million to US$16.2 billion as of February 20, 2026, despite the repayment of a US$700 million loan to the China Development Bank.

On the currency front, PKR appreciated by 0.03%WoW against the greenback during the week, closing the week at 279.47 PKR/ US$.

Other major news flow during the week included: 1) Trump hikes US global tariff rate to 15%, 2) IMF hints at phased tax cut approach, 3) Prime Minister Shahbaz Sharif and Qatari Emir agree to deepen economic cooperation, 4) Profit repatriation rises to US$1.67 billion in 7MFY26, and 5) CCP clears Abu Dhabi-based Eve Holdings’ acquisition of First Women Bank.

Vanspati & Allied Industries, Fertilizer, and Automobile Parts & Accessories were amongst the top performing sectors, while Tobacco, Synthetic & Rayon, and Property were amongst the laggards.

Major selling was recorded by Individuals and Foreigners with a net sell of US$18.0 million and US$17.3 million, respectively. Banks absorbed most of the selling with a net buy of US$33.9 million.

Top performing scrips of the week were: SSOM, AKBL, THALL, POL, and BAFL, while laggards included: UNITY, SSGC, TRG, YOUW, and IBFL.

AKD Securities expects the market to recover as domestic and geopolitical uncertainties subside, with market trading at attractive valuations of forward PE of 7.2x and Dividend Yield of 6.6%. The brokerage house anticipates the benchmark Index to reach 263,800 by end December 2o26.

Investors’ sentiments are expected to improve on the likelihood of foreign portfolio and direct investment flows, driven by improved relations with the United States and Saudi Arabia.

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

War with Iran Can Be a Strategic Mistake

In his recent address, US president Donald Trump again signaled that military action against Iran remains an option — citing Tehran’s nuclear ambitions, missile program, regional conduct, and human rights record. The message was firm - Iran must never acquire a nuclear weapon. On that objective, there is rare bipartisan consensus in Washington, but consensus on a goal is not consensus on a method.

Public opinion in the United States is far more cautious than political rhetoric. After the costly wars in Iraq and Afghanistan, American voters are wary of another open-ended Middle Eastern conflict. Polling indicates limited appetite for military escalation. That hesitation reflects hard-earned lessons - wars launched with limited objectives often expand beyond initial calculations.

For Pakistan and the broader region, the consequences would be immediate and severe. Iran sits at the crossroads of global energy routes. Any disruption in the Strait of Hormuz would send oil prices sharply higher, straining fragile economies across South Asia. For energy-importing states already battling inflation and external account pressures, this would be destabilizing.

Equally important is the question of strategic clarity. Is the objective deterrence? Degradation of nuclear capability? Or regime change? Absent a clearly articulated end-state, military action risks triggering retaliation without securing lasting stability. Even limited strikes could invite asymmetric responses across the region.

Iran insists its nuclear program is peaceful, though its stockpile of highly enriched uranium alarms Western powers. Yet past diplomatic frameworks proved that monitoring and verification are possible when political will exists. Diplomacy is slow and frustrating, but war is irreversible.

The 21st century offers enough evidence that military adventurism in the Middle East produces unintended and often uncontrollable consequences. From prolonged insurgencies to regional fragmentation, the record is sobering. An attack on Iran could become another costly chapter in that history — one that reshapes the region in ways no strategist can fully predict and no economy can easily absorb. Strategic restraint is not idealism; it is realism grounded in experience.

Washington’s Iran Policy: Security Rhetoric, Energy Reality

The dominant narrative in Washington frames Iran as a nuclear threat and a destabilizing regional actor. Yet beneath the moral language and security rhetoric lies a more pragmatic driver - energy geopolitics. The United States’ posture toward Iran appears shaped less by concern for Iranian citizens or nuclear anxieties alone, and more by the strategic calculus of global oil and gas dominance.

Over the past decade, the United States has undergone a structural energy transformation. Once heavily reliant on imported hydrocarbons, America is now a leading oil and LNG exporter. This shift has inevitably altered its foreign policy priorities. Sanctions regimes and diplomatic pressure have systematically constrained the energy exports of major producers viewed as adversarial or strategically inconvenient — including Iran, Russia, and Venezuela. The objective is not merely punitive; it is market-shaping.

Iran presents a unique case. Despite nearly half a century of sanctions, isolation, and economic warfare, the Islamic Republic has neither collapsed nor capitulated. Its economy has been bruised, but its political structure remains intact. History suggests that external pressure has not succeeded in engineering regime change in Tehran. Instead, it has often entrenched domestic resistance while imposing hardships on ordinary Iranians.

The persistence of confrontation raises a critical question, what has been achieved? Sanctions have constrained revenues but not fundamentally altered Iran’s regional behavior or strategic ambitions. Meanwhile, geopolitical tensions inject volatility into global energy markets, adding risk premiums that burden consumers worldwide.

A reassessment is overdue. Durable stability rarely emerges from perpetual pressure. Diplomatic engagement anchored in mutual economic interests — including structured energy cooperation — offers a more realistic pathway. Iran has repeatedly denied seeking nuclear weapons, and whether one accepts this claim or not, diplomacy remains the only verifiable mechanism for accountability.

Washington must recognize a simple geopolitical truth - coexistence delivers more than coercion. Escalatory rhetoric and regime-change fantasies have yielded diminishing returns. A pragmatic reset — reducing hostility, encouraging dialogue, and prioritizing regional stability — would better serve global economic and security interests.

Confrontation may generate headlines. Engagement, however, produces results.

Washington Iran policy, US Iran tensions, Iran sanctions, energy geopolitics, oil politics, nuclear narrative, Middle East stability, regime change debate, global energy markets, US foreign policy,

Trump Must Accept Strategic Reality

For nearly half a century, Washington has relied on sanctions, isolation, and coercion to reshape Iran’s behavior. The results are sobering. Rather than capitulate, Tehran adapted. Its political system endured, its regional footprint expanded, and its negotiating posture hardened. Yet Donald Trump has revived the vocabulary of “maximum pressure,” again pairing economic strangulation with threats of military escalation and even rhetoric about targeting Iran’s top leadership.

This moment is being framed as a last chance for diplomacy. Ali Khamenei, now in his late eighties, faces a consequential decision: accept severe limits on Iran’s nuclear program or risk confrontation with the United States and Israel. Reports suggest U.S. envoys favor transactional breakthroughs, while military planners warn that a campaign against Iran could spiral into a prolonged conflict. Such caution is not academic. The Middle East’s history is littered with wars that began as “limited strikes” and evolved into grinding, unpredictable entanglements.

Even recent use of force underscores the limits of coercion. Joint strikes did not erase Iran’s nuclear capabilities outright. Meanwhile, Tehran signals it will not negotiate away what it views as core deterrence — uranium enrichment rights and missile capacity. Offers like diluting enriched uranium or joining a regional enrichment consortium hint at possible off-ramps, but maximalist demands risk closing those exits before they are fully explored.

There is another underappreciated dimension: regional complicity. Past operational successes by Washington and Tel Aviv were facilitated by access, logistics, and airspace in neighboring Muslim-majority states. If those governments now hesitate or refuse, the military calculus changes dramatically. Geography, not just firepower, shapes outcomes.

Regime-change fantasies should also be retired. Decapitation strategies rarely produce stable, pro-Western transitions; more often they unleash fragmentation, nationalism, and cycles of retaliation. Iran’s leadership has reportedly prepared for succession contingencies, signaling that the state’s continuity does not hinge on one individual.

Strategic reality demands sobriety. Escalation may satisfy domestic political narratives, but it heightens risks for regional stability, global energy markets, and civilian lives. Durable security will not emerge from threats alone. It requires credible diplomacy, respect for redlines, and a recognition that adversaries under pressure do not always break — they often dig in.

The wiser course is clear: de-escalate rhetoric, widen diplomatic space, and prioritize negotiated constraints over another open-ended conflict. History has already delivered its verdict on wars of choice. 

Who Decides War: Trump, or the Constitution?

A credible democracy does not drift into war on the strength of rhetoric, speculation, or executive impulse. Yet that is precisely the anxiety surrounding President Donald Trump and the intensifying discussion of possible US military action against Iran. Reports suggest that lawmakers may soon vote on whether to restrain the president’s authority to initiate hostilities without explicit approval. That vote, if it happens, will not be procedural theater — it will be a constitutional test.

The power to declare war resides with the US Congress, not the White House. This division of authority is not a technicality; it is a safeguard designed to prevent unilateral decisions carrying irreversible human, economic, and geopolitical consequences. Limited defensive strikes may fall within executive discretion, but sustained, weeks-long military operations clearly cross into territory requiring legislative consent.

According to Reuters, the US military has been preparing for the possibility of extended operations should diplomacy fail. Preparation, however, must not be confused with authorization. A democracy’s legitimacy rests not merely on capability, but on adherence to process.

The bipartisan initiatives led by Senators Tim Kaine and Rand Paul, alongside Representatives Thomas Massie and Ro Khanna, reaffirm a fundamental principle - if war is justified, elected officials must debate it openly and vote on it transparently. Evading that responsibility corrodes accountability and weakens democratic credibility at home and abroad.

Supporters of expansive presidential authority argue that Congress should not restrict national security powers. But oversight is not obstruction. Requiring approval is not weakness. It is the constitutional mechanism ensuring that war reflects national consensus rather than political expediency.

An attack on Iran would reverberate far beyond the battlefield — unsettling global markets, inflaming regional tensions, and risking dangerous escalation across an already volatile Middle East. Such a decision demands scrutiny measured not in cable news cycles, but in constitutional gravity.

If conflict is unavoidable, Congress must own the decision. If peace remains possible, diplomacy must be exhausted. What cannot be justified is silence — or worse, the surrender of legislative authority when it matters most.