Israel’s Strategic Energy Calculus Against Iran’s Nuclear Ambitions

Weighing Energy Warfare and Regime Pressure in a High-Stakes Conflict

What is the end game for Israel? What even is the short-term plan? The context has not changed - Israel is tiny, the size of New Jersey, with its population densely packed around Tel Aviv, making it acutely vulnerable to a single devastating strike - just one nuclear bomb is an existential threat. There is no longer any doubt, if there ever was, that Iran has the ballistic missile technology to deliver a nuclear warhead.

Iran is big, it is 3x bigger than France and has a population of 90 million. Writing about possible nuclear war is very uncomfortable - but even if Israel considered using “tactical” nuclear strikes - these would not be existential to Iran. Yet, the reality facing Israel is that the Iranian theocratic leadership has repeatedly called for the annihilation of Israel.

So how to stop Iran¹ building a nuclear bomb? Ariel supremacy allows for degradation of the ballistic missile capability and the effective bombing of nuclear facilities. Targeted assassinations of top nuclear scientists decapitates the knowledge base. Invasion is clearly not an option. But even put together, these will simply delay the undesirable by a few years: a few assassinations will not cause Iran to “unlearn” about nuclear technology (plus they will undoubtedly be aided in reconstruction by other problematic nuclear powers). Likewise, without the US MOABs some of the nuclear facilities will be too deeply buried to be bombed by Israel.

All of this points to a strategy directed at regime change, despite the obvious official denials. The choice of name “Operation Rising Lion”, has sparked speculation that it also evokes the Lion and Sun emblem, a historic symbol of Iran under the Pahlavi monarchy until the 1979 Islamic Revolution, suggesting a possible allusion to restoring a pre-revolutionary order.

Energy Warfare - Domestic

I discussed how Russia and Ukraine have targeted energy infrastructure as part of the broader conflict in my 2024 post “The Siege of Europe”. Likewise, Israel and Iran have attacked oil and gas facilities - but with a significant geopolitical context - neither side has (so far) done anything to attack Iran’s oil export capability.

Iran’s domestic industry has been targeted:

• South Pars Gas Field: Israel struck the Iranian portion of the world’s largest natural gas field, located in Bushehr province, on June 14, 2025. This field accounts for two-thirds of Iran’s gas production, primarily used for domestic power generation and fuel supply. The attack caused fires and partially suspended production at Phase 14, disrupting 12 million cubic meters per day of gas output.

• Shahran Fuel Depot: A key fuel storage facility near Tehran was hit, causing a massive blaze. This depot supplies about three days’ worth of Tehran’s fuel needs, critical for domestic consumption.

• Shahr Rey Refinery: Reports of strikes on this major refinery, vital for producing gasoline and other refined products for Iran’s domestic market, were noted, though Iranian media denied direct hits, claiming only a nearby fuel tank was affected.

• Fajr-e-Jam Gas Refinery: Located in Bushehr, this facility was targeted, threatening domestic electricity and fuel supplies in southern and central Iran.

• Asaluyeh Oil Refinery: Also in Bushehr, this refinery was hit, further straining Iran’s ability to produce refined products for domestic use.

Iran has retaliated by targeting Israel’s Bazan Refinery in Haifa, a critical facility processing 200,000 barrels per day (80% of Israel’s refining capacity). The attack on June 16, 2025, damaged pipelines and transmission lines, forcing partial shutdowns and contributing to a 24-hour suspension of fuel sales in Israel.

Israel also shut down its Leviathan Gas Field, a major source of domestic gas and exports to Egypt, due to security threats, disrupting regional gas flows and raising global gas price volatility.

Images of massive lines at petrol stations in Tehran, and now news of fuel rationing (to industry, for the moment) in Israel allude to the immediate impact of these strategies.

Israel’s focus on Iran’s domestic infrastructure looks strategic, exploiting existing weakness in it’s sanctions-battered petroleum sector. With blackouts already costing Iran $250 million daily, these strikes could tip public frustration into unrest, a pressure point Tehran itself has acknowledged. This looks like energy warfare dressed up as military necessity, aiming to destabilize without the messy optics of regime change.

Energy Warfare - Exports

The “elephant in the room” is Iran’s oil exports - which are very vulnerable due to the concentration on Kharg Island Oil Terminal. Israel has deliberately spared these primary oil export facilities - Kharg Island alone handles over 90% of Iran’s crude oil exports (approximately 1.5 million barrels per day, mostly to China). From my perspective, thousands of miles away this looks like pure geopolitics. The USA (and especially President Trump) do not want an “oil shock” at a time of global (inflationary) trade tariffs. Moreover, disrupting oil exports to China could/would be seen as a hostile action (and there are already unconfirmed reports of Chinese cargo planes mysteriously turning off their transmitters as they approach Iran). Nobody wants this to turn into a super-power proxy-war.

Image: Financial Express

At the time of writing (17th June 2025), Iran has not blocked the Straits of Hormuz - one of its last, and biggest cards to play. That said, Iran relies heavily on oil exports through the strait for revenue, with over 2 million barrels per day sent to China, its top buyer. Blocking the strait would cripple its own economy, potentially alienate allies like China, and provoke a severe military response from the U.S. and Gulf states, who prioritize the strait’s security for 20% of global oil flows. Tehran’s threats seem to be more about deterrence than intent, as escalation risks outweigh domestic gains, especially amid internal economic strain from Israel’s strikes. However, if the situation internally deteriorates, I’d guess that this is not off the table.

April Is The Cruelest Month

There has been much speculation that OPEC+’s production increases, notably a 411,000 barrel-per-day hike announced for July, created a strategic buffer that may have enabled Israel’s strikes on Iran’s nuclear and energy infrastructure. By boosting supply, OPEC+, possibly influenced by the U.S., kept oil prices stable, with Brent crude around $74–$78 post-strike, mitigating the risk of a war-induced price shock from potential disruptions to Iran’s oil output.

It has been suggested that Israel’s attack, originally planned for April but delayed, aligns with these production hikes. As Rory Johnson noted: “OPEC accelerated prod hikes in April bc of an impending Iran strike” make the thesis “more plausible,” especially as Saudi Arabia held back on further increases. The delay, likely due to U.S. pressure to avoid escalating tensions during nuclear talks, allowed OPEC+’s spare capacity, primarily from Saudi Arabia and the UAE, to cushion markets, supporting Israel’s economic warfare strategy while keeping global energy costs in check.

Rory Johnson on X

President Trump is an enigma. He is very focused on cost of living and has an unusually perceptive understanding of how the global price of oil affects American consumers - yet he is also an advocate of trade tariffs which are inherently inflationary. He is anti-war, but equally not a peacenik-at-any-price. Given his concerns about domestic inflation and oil prices, his efforts to get the US out of “forever wars” - one has to think he must have serious concerns about just how close Iran is/was to making a nuclear bomb.

Megatron on X

Many observers (including the IAEA²) suggest that Iran has developed nuclear material and technology that goes well beyond anything that could reasonably be used for non-military applications.

News reports from June 2025 (example CNN) indicate Iran had advanced significantly toward nuclear weapons capability, with enough 60% enriched uranium for nine to ten bombs and the potential to reach bomb-grade levels in weeks, per IAEA findings. Its violations of the JCPOA and NPT, including unreported enrichment to 83.7%, new facilities, and restricted IAEA access, confirm substantial non-compliance, escalating tensions.

The one big caveat of course is that the invasion of Iraq in 2003 was justified by “intelligence” on Saddam’s WMD. Even with that deeply troubling example in mind, there is clear concern about Iran’s nuclear progress in Washington.

European countries have done the usual pussy-footing platitudes about de-escalation and more negotiations. But how do you return to negotiations about nuclear proliferation with a regime that has clearly been cheating on its previous negotiated agreements? Having been attacked by Israel, one could imagine a surviving Iranian regime would be even less incentivized to adhere to future agreements - hence we get back to the discussion about regime change as an objective.

Quo Vardis?

Israel faces an existential threat from Iran’s nuclear program, with its ballistic missiles, near-weapons-grade uranium and direct threats of annihilation posing a clear and present danger. While aerial strikes and targeted assassinations aim to delay Iran’s progress, these measures are temporary, as Iran’s size and technical knowledge limit their long-term impact. Operation Rising Lion’s secondary focus on disrupting domestic energy infrastructure likely seeks to destabilize Iran’s economy and encourage internal unrest, possibly hinting at regime change despite official denials - offering perhaps the only long-term solution for Israel.

Sparing Iran’s oil exports reflects geopolitical caution to avoid broader economic fallout. The U.S., wary of escalation and domestic concerns, likely influenced the timing to align with global energy stability. Yet, Iran’s violations of nuclear agreements and hostile rhetoric undermine diplomacy, leaving Israel’s strategy of energy warfare and precision strikes as a short-term effort to slow a persistent danger, with no clear path to a lasting resolution, outside of (positive) regime change.

1. For clarity “Iran” in the context of this post herein refers to the current governement of Iran, not the broader population that may have different views and objectives

2. International Atomic Energy Agency | Atoms for Peace and ... (the Nuclear “watchdog”)