Middle East Special Issue: March 2026

The Islamic Republic faces an existential fight for survival 

Analysis Manager Timothy Lay

With its leadership decapitated, strikes at the heart of its military apparatus, and a wider regional conflagration ignited, the Islamic Republic is fighting for its survival. The ultimate outcome of the war — and whether it leads to regime collapse — remains, however, profoundly uncertain.

Despite the unprecedented intensity of the military campaign, full capitulation — encompassing the abandonment of Iran’s nuclear and missile programs and its anti-US/anti-Israel posture — remains unlikely, even after the killing of Khamenei. Hardline elements within the IRGC are likely dominating decision-making for now. Washington may be banking on rapid internal fracture or large-scale defections, yet there is little evidence of this so far within a deeply institutionalized, entrenched, and ideological system. A successful popular uprising also remains improbable: The public is unarmed, unorganized, and confronting one of the most repressive regimes in the region. While strikes have targeted an increasing number of local IRGC, Basij, and police bases to erode domestic repression capacity, the regime retains intelligence and internal security institutions capable of suppressing civilian dissent.

The ongoing, unprecedented campaign is, however, significantly degrading Iran’s military and nuclear capabilities. There are unconfirmed reports suggesting that Mossad and Israeli special forces may have entered Iranian territory and operated at nuclear facilities.⁵ Yet absent the collapse of the regime itself, any surviving leadership will — once hostilities subside — move to rebuild what it perceives as essential deterrent capabilities and ideological red lines. In effect, the only clear path to a decisive victory — especially for Israel — would be regime change, a far longer, costlier, and more destabilizing undertaking than a limited air campaign is likely to achieve.

However, there are already indications that the campaign is evolving beyond a purely aerial confrontation toward a broader multi-domain effort. Strikes in Kurdish-majority western provinces, including attacks on border guard and internal security positions, suggest that peripheral destabilization may be underway. Such measures could stretch the regime’s security apparatus, but they also risk chaos and prolonged domestic instability, with potential wider implications for regional security dynamics.

Given that the Islamic Republic is more likely to continue fighting than to concede, the war’s trajectory may prove more protracted and unpredictable than decision-makers in Washington anticipated.

See our live Iran crisis hub for daily updates on the conflict unfolding in Iran and the wider region.

Iran continues retaliatory strikes amid growing constraints 

Middle East Assistant Research Manager Nasser Khdour

Iran’s continued retaliatory strikes against Israel demonstrate persistence, but they also reveal growing limitations as the war progresses. Tehran appears intent on sustaining missile fire to maintain pressure on Israel and project resilience. It may also be calculating how prolonged attacks could strain Israel’s ability to sustain high interception rates. 

However, Iran’s missile strategy faces clear constraints. ACLED data show that the number of missile attacks recorded in Israel on the third and fourth days of the war declined compared to the first two. Before the current war, estimates suggested that Iran possessed around 2,500 long-range ballistic missiles.⁷ Since the start of the conflict, hundreds have been launched, destroyed, or targeted in storage facilities.⁸ 

A second constraint concerns production capacity and Iran’s ability to sustain launches while under continuous airstrikes. One of Israel’s primary objectives has been to degrade Iran’s missile capabilities by targeting launchers, production sites, and underground infrastructure. As the US-Israeli coalition strikes launch facilities and storage depots, Iran’s ability to regenerate and coordinate missile fire is likely to weaken. At the same time, Israel’s defensive capacity remains a decisive factor. Its multi-layered air defense system continues to intercept incoming missiles, which limits the overall effectiveness and strategic impact of Iranian strikes.

Thus, while Iran can continue retaliatory attacks, sustaining meaningful pressure on Israel over time will become increasingly challenging. If Tehran anticipates a prolonged confrontation lasting weeks and must also preserve missile stockpiles for other potential fronts, it will likely be compelled to gradually reduce the scale and frequency of its launches toward Israel.

See more of ACLED’s coverage on Israel.

From risk aversion to direct exposure: The Gulf’s security illusion has collapsed 

Yemen and the Gulf Senior Analyst Luca Nevola

In retaliation for the joint US-Israeli strikes on Iranian territory, Tehran launched an unprecedented barrage of missiles and drones at multiple Gulf states. Although Iranian officials claimed the strikes were aimed exclusively at US military installations,¹⁰ the escalation extended beyond US bases, hitting energy infrastructure, civilian airports, and emblematic luxury districts. For the first time in history, Iran attacked all Gulf Cooperation Council (GCC) countries: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE.

Few Gulf monarchies had anticipated this escalation. For decades, the Gulf territory had remained largely insulated from direct Iranian fire; since the Tanker War of the late 1980s, Tehran had avoided openly targeting the region. It relied instead on proxy groups or operated in other theatres, aside from a limited strike on Qatar in June 2025.

Most GCC states have pursued de-escalation with Iran and hedging, while seeking to reduce their dependence on oil exports through tourism and foreign investment. For Riyadh, this shift followed the 2019 Abqaiq attacks and the realization that the US security umbrella would not automatically guarantee retaliation. Even confrontations with Iranian allies were managed cautiously: Houthi strikes on Jeddah and Abu Dhabi in 2022 were treated as strategic shocks and helped pave the way for the UN-mediated truce in Yemen.

The current attacks dispel the illusion that regional conflict won’t affect the Gulf’s skies and economies and expose the limits of existing deterrence. The Gulf’s ability to defend itself is affected by the reality of asymmetric warfare: mixed platforms, swarm tactics, and geographically dispersed attacks risk saturating air defences, while prolonged conflict could strain the resupply of interceptors. So far, multi-layered systems¹¹ have intercepted about half the attacks, while drones have carried out the majority of successful hits. Each successful strike carries disproportionate symbolic weight and outsized economic consequences.

These consequences are already visible. Investor confidence is under pressure, war-risk surcharges have risen¹² amid threats to close the Strait of Hormuz,¹³ and regional markets have recorded losses. The energy sector remains particularly exposed, as it is vulnerable to both infrastructure targeting and disruptions to export routes through Hormuz and potentially the Red Sea.

Armed factions in Iraq could pull the country into war

Middle East Research Manager Muaz Al Abdullah

Sandwiched between competing interests, Iraq risks being dragged into the regional war. Not only is Iraq home to a constellation of pro-Iran militias, but the US and Israel are now courting Iranian Kurdish opposition groups operating in the northeastern Kurdistan region. These centrifugal forces are, in turn, straining the Iraqi government’s ability to enforce its decision to sit out the conflict.

PMF militias retain the ability to operate independently of Baghdad's authority, despite attempts to integrate them into the regular Iraqi forces. The calculated drawdown of US forces from major Iraqi bases in January has left Iraqi militias and Iranian forces with only a few viable targets for retaliatory attacks within the country. In one such attack, pro-Iranian militias claimed a largely symbolic strike on the US Harir military base in Erbil. 

While PMF factions have thus far limited their involvement in armed activities, they have the capacity to help the Iranian government repress any ethnic insurgency that breaks out at Iran’s westernmost periphery. Tehran’s recent targeting of military camps and headquarters of Iranian Kurdish opposition groups in northern Iraq underscores its persistent concern over internal unrest and cross-border insurgent mobilization. Iranian Kurdish opposition groups in northern Iraq present such a threat to the Iranian regime, and Israel appears set to exploit it with targeted strikes on Iranian border forces.

See more of ACLED’s coverage on Iraq.

Hezbollah joins the war against Israel despite its vulnerability

Middle East Assistant Research Manager Nasser Khdour

It took Hezbollah two days to join the war. After two years of ongoing Israeli strikes — including targeted assassinations of leaders and commanders and attacks on military, financial, and logistics networks — that weakened the group, pressure rather than strength has driven Hezbollah’s decision to attack Israel. Indeed, the attacks came in retaliation for the killing of Khamenei, who was the most important religious leader for Shiites in Lebanon. 

For decades, Hezbollah was the crown jewel of the Iran-led Axis of Resistance, and when Tehran is directly challenged, the group is expected to act. Yet Hezbollah’s involvement in support of Iran is only likely to increase its vulnerability, given its diminished military capabilities and fragile domestic position. Although Hezbollah still has around 25,000 missiles, 1,000 drones, and thousands of elite fighters,¹⁸ its freedom of movement and military presence near the Israeli border and south of the Litani River have been greatly damaged.

As with the Iranian regime, the spread of this war presents an existential threat to Hezbollah. Israel is taking the war as an opportunity to further weaken Hezbollah’s military and financial capabilities and to target its leadership. It may also expand its control south of the Litani River to increase pressure on the Lebanese government and the Shiite community. For its part, in the event of an Israeli ground invasion of southern Lebanon, Hezbollah would likely present itself as the bastion of “resistance,” framing its involvement as a response to continued Israeli attacks and the establishment of Israeli bases inside Lebanon, even during the ceasefire.  

Within Lebanon, Hezbollah faces intensified pressure. The Lebanese government has banned Hezbollah's military activities and ordered security forces to prevent any attack from Lebanon. Its political group is increasingly isolated, and its alliance with Lebanon’s other Shiite party, the Amal Movement led by parliamentary speaker Nabih Berri, has never been more fragile. The country’s financial crisis has also eroded Hezbollah’s ability to provide financial support to its base, and frustration within parts of the Shiite community is more visible than in previous rounds of confrontation. 

See more of ACLED’s coverage on Lebanon.

Despite threats of escalation, the Houthis exert strategic patience

Yemen and the Gulf Senior Analyst Luca Nevola

Having ceased attacks on Israel and international shipping vessels in the Red Sea following the Israel-Hamas ceasefire in October 2025, Houthi leaders repeatedly warned that operations would resume in the event of a US or Israeli war against Iran. Thus far, though, they have resisted entering the fray.

In recent weeks, as the risk of war with Iran intensified, several Houthi leaders signalled support for Tehran and hinted at renewed Red Sea operations.¹⁹ However, once hostilities began, the group confined itself to rhetorical solidarity,²⁰ avoiding direct military action. As was the case after 7 October 2023, this restraint may reflect a phased escalation strategy.

Renewed Houthi strikes on Israel would constitute the most immediate and symbolically coherent response. However, the Houthis appear restrained by Israeli airstrikes in August and September 2025, which decapitated the Sanaa government and military leadership, and further attacks could invite another round of Israeli retaliation.

Escalation by the Houthis could also target US military assets, including warships in or near the Red Sea and bases across the Gulf, particularly in Bahrain, which is home to the US Fifth Fleet. In June 2025, during the 12-day war involving Iran, the group threatened to target US warships despite the 6 May truce with Washington.²¹ Washington might respond with limited retaliatory strikes, but a renewed campaign in Yemen appears unlikely. For now, the Houthis seem unwilling to test that threshold. 

Attacks on commercial shipping remain the Houthis’ most powerful deterrent. On 29 September, the group struck the Dutch cargo vessel MV Minervagracht following the snapback of sanctions on Iran.²² Yet resuming attacks would invite international condemnation and undermine talks with Riyadh, especially amid disruptions to oil exports through the Strait of Hormuz. Nonetheless, controlled, incremental escalation — starting with symbolic actions focused on commercial shipping — appears most likely.

See more of ACLED’s coverage on Yemen.