Trump Has to Finish the War in Iran, Roubini Says

Summary

• Presents two scenarios for the US-Iran conflict: de-escalation/ceasefire vs. escalation/"finishing the job," assigning a ~67% (two-thirds) probability to the escalation path.
• Argues de-escalation would allow Iran to control the Strait of Hormuz, threaten global oil supplies, and would guarantee US electoral losses for the incumbent administration.
• Believes the US has a political imperative to escalate to win the war, aiming for de facto or formal regime collapse in Iran to ensure a more stable Middle East.
• Describes the escalation scenario as involving taking Carr Island, reopening the Strait of Hormuz, continued bombing campaigns, destruction of military/nuclear assets, and targeting Iranian leadership.
• Outlines the negative outcome of a failed escalation: Iran could further blockade the Strait of Hormuz and destroy Gulf energy supplies, leading to "1970s stagflation all over again."
• Outlines the positive outcome of a successful escalation: short-term oil price spike above $120 for 2-3 months, followed by a return to a stable world order.
• Framed the conflict as a global threat, with Iran's radical regime posing risks to the Gulf, Israel, Europe, Asia, and the US via ballistic missiles and economic disruption.
• Cites alignment with Gulf states (like the UAE) who view Iranian control of the Strait of Hormuz as unacceptable.
• Characterizes the current situation as a "disaster" and the war so far as a "failure," but contends that starting a war creates an obligation to finish it to avoid a worse outcome.