On February 28, a carefully coordinated American and Israeli attack on Iran — which has for decades been calling for the destruction of both countries — appeared to achieve its primary first strike objective, the elimination of Iran’s Supreme Leader Ayatollah Ali Khameni. Along with the death of Khamenei, which was officially acknowledged at the end of the first day of the war, a number of senior military officials also died in the early strikes, including Islamic Revolutionary Guards Corps (IRGC) Commander Mohammad Pakpour, Iran’s Defense Minister Amir Nasirzadeh, Adviser to Supreme Leader Khamenei, Ali Shamkhani, and Chief of Staff of the Iranian Armed Forces, Mohammad Bagheri, according to an Israel Defense Force (IDF) spokesperson.
Iran International reported that the initial strikes killed four senior Iranian intelligence commanders: Javad Pourhossein, head of the Foreign Intelligence unit; Mohammad-Reza Bajestani, head of the Security unit; Ali Kheirandish, head of the Counterterrorism unit; and Saeed Ehya Hamidi, Adviser on the War with Israel.
Iran has long had plans for the succession of senior officials, which have now been activated to bring in interim leaders. In view of obvious Iranian intelligence vulnerabilities, the plan is probably well known to Iran’s opponents. Iranian President Masoud Pezeshkian has assumed the role of interim leader until the so-called three member Leadership Council moves to appoint a new leader, presumably in the coming days.
Trump offers amnesty
U.S. President Donald Trump issued a video message on February 28 announcing the first strikes, declaring the aim of the combined operation is to “ensure that Iran does not obtain a nuclear weapon.” “We’re going to destroy their missiles and raze their missile industry to the ground. It will be totally again obliterated,” he said in an eight-minute video posted on his Truth Social network in the morning of February 28.
Trump  also warned Iran’s armed forces to lay down their weapons in return for “complete immunity,” or “face certain death.” He then urged the Iranian people to prepare to overthrow the clerical establishment: “When we are finished, take over your government. It will be yours to take. This will probably be your only chance for generations.”
The U.S. Central Command, responsible for the Middle East, said they were working to “dismantle the Iranian regime’s security apparatus, prioritizing locations that posed an imminent threat.”
On Day One of “Operation Epic Fury,” the U.S. conducted 900 strikes against Iranian targets with Israel claiming another 500. Targets included Iran’s military, missile, air-defense and primary leadership infrastructure, as noted above.
Additional waves were sent on Day Two. Trump said U.S. operations were “ahead of schedule” and noted the Iranian Navy had lost as many as nine vessels in engagements on March 1. An already sanctioned (by the U.S.) oil tanker was struck by U.S. forces on Day Two as well. Surprisingly, he also indicated a willingness “to talk to Iran’s new leaders” whenever they emerge.
Almost immediately President Trump’s domestic opponents challenged his authority to launch the “Epic Fury” military campaign, especially since Trump used the term “war” in his video message. Opponents claim that the 1970’s era War Powers Resolution required any President to obtain congressional approval beforehand, although some senior congressional leaders had in fact been briefed before the attacks. However, there is a 60-day limit after which Congressional approval will be needed for hostilities to continue. This mostly legal debate will intensify in the coming days but will have no visible impact on the conduct of the war.
Iran’s retaliation casts a provocative regional shadow
After a series of largely ineffective missile and drone barrages fired at its neighbors and nearby U.S. bases on February 28, Iran intensified its retaliatory attacks March 1 against Israel and Gulf Arab countries. It vowed to step up strikes after the killing of Supreme Leader Khamenei and many of his senior leadership team, and Trump warned against major escalation via his Truth Social network. The intensity of Iran’s retaliation against Gulf Arab states, including Iran’s sometimes political allies like Qatar and Oman, has surprised and angered many across the region. Because it is targeting local civilian infrastructure as well as U.S. bases, Iran is generating zero sympathy, if not actually losing support by the hour. At the end of Day Two, Iran’s operatives in Lebanon’s Hezbollah began launching short range rockets against Israel. Retaliation followed quickly.
Cumulative casualty estimates since the campaign began (across both days) include over 200 killed and hundreds injured within Iran. Iranian retaliatory strikes have so far caused additional deaths and injuries in Israel (10 civilian deaths and 100 wounded) and the Gulf (three dead and around 60 wounded), as well as the U.S. military casualties reported on Day Two (three dead, five seriously wounded).
Assessing the unknowable
It is too early to assess the economic impact of the war, something which we will attempt in a few days based on available data. With one fifth of the world’s oil said to transit the Straits of Hormuz, Iran’s closure attempt at Hormuz amounts to a declaration of economic war against most of the world as much as it is a plea for assistance from its key oil trading partners like India and China. One thing is clear; a higher structural risk premium will need to be considered almost everywhere in the coming days when looking at Middle East energy prices and the conflict’s wider impacts on other supply chains including Iran’s industrial production, such as drones and equipment destined for Russia.
Some will call this profiteering, but it is how markets eventually find balance in a crisis. And every time another talking head on television or social media makes an unfounded claim about “projected” energy price rises, someone sees an increase in their profit margins.