America’s Middle East Order Under Strain as War in Iran Redraws Geopolitics

In a recent episode of Middle East Eye’s “Big Picture” programme, economics editor Mehreen Khan examined the far‑reaching consequences of the United States and Israel’s war on Iran. The discussion, recorded on 14 September 2026, moves beyond battlefield casualties to interrogate how the conflict is reshaping the tools of statecraft, the energy landscape of the Gulf, and the broader rivalry between Washington and Beijing. For Palestinians and other peoples living under occupation, these shifts matter not only in abstract geopolitical terms but also in the concrete ways they affect daily life, humanitarian access and the possibilities for a just resolution to the Israeli‑Palestinian conflict.

Sanctions as a Fraying Instrument of Power

The programme opens with a detailed look at how U.S. sanctions, long used as a cornerstone of American foreign policy, are being tested by the war on Iran. Khan points out that the United States has traditionally relied on financial isolation—particularly through the dollar‑centric global system—to pressure regimes it deems hostile. Yet the current conflict has exposed the limits of this approach.

Sanctions were intended to choke off Iran’s ability to fund its nuclear programme and support for proxy groups. However, the war has forced Tehran to seek alternative channels for financing and trade, prompting a modest but noticeable shift toward non‑dollar currencies. This “de‑dollarisation” trend, while still nascent, signals a growing willingness among sanctioned states to circumvent the American financial network.

For Palestinians, the weakening of sanctions as a decisive lever raises concerns about the future of pressure on Israel. If the United States finds its primary tool less effective, the international community may need to explore complementary strategies—such as targeted trade restrictions, arms embargoes, or diplomatic isolation—to hold Israel accountable for settlement expansion and human‑rights violations.

The discussion also touches on the broader economic fallout of a “U.S. Economic D‑Day.” A prolonged conflict could destabilise global markets, potentially inflating the cost of essential imports for Gaza and the West Bank, where many households already spend a large share of income on food. The indirect impact on the most vulnerable underscores why the war’s economic dimensions must be scrutinised alongside its military aspects.

The Strait of Hormuz and Gulf Energy Dynamics

Transitioning from sanctions, the episode devotes a segment to the strategic importance of the Strait of Hormuz and its influence on Gulf energy markets. The narrow waterway, through which a substantial portion of the world’s oil passes, has become a flashpoint as Iranian forces threaten to disrupt shipping in retaliation for Israeli strikes.

Khan notes that any closure or significant disruption would reverberate through global oil prices, affecting not only distant economies but also the Gulf Cooperation Council (GCC) states whose revenues depend heavily on hydrocarbon exports. The prospect of a “sharp rise” in oil prices could paradoxically benefit oil‑rich Gulf monarchies while simultaneously heightening the cost of living for ordinary citizens across the region, including Palestinians who rely on imported fuel.

The discussion highlights how GCC countries are navigating a delicate balance. While they share security concerns with the United States, they also fear being drawn into a broader confrontation that could jeopardise their own stability. Some Gulf states are therefore quietly seeking to diversify their economies and energy portfolios, a trend that has been accelerated by the war’s uncertainty.

For the Palestinian cause, the volatility of energy markets can have indirect but potent effects. Higher fuel costs translate into increased transportation expenses for humanitarian aid trucks entering Gaza, potentially slowing the delivery of essential supplies. Moreover, the heightened geopolitical tension may distract international attention from the ongoing humanitarian crisis, making advocacy for Palestinian rights even more urgent.

US‑China Competition in a Shifting Middle East

The third segment of the video explores how the Iran war is reshaping the strategic competition between Washington and Beijing. Khan argues that the United States is forced to allocate more military and diplomatic resources to the Middle East, potentially limiting its capacity to counter China’s growing influence in the region.

China, observing the conflict, has sought to deepen economic ties with Iran and other states that feel marginalized by Western sanctions. While the video does not provide specific figures, it suggests that Chinese firms are positioning themselves to fill gaps left by Western companies withdrawing from Iranian markets. This “post‑sanctions” engagement could embed China more firmly in the Middle Eastern economic architecture.

From a Palestinian perspective, the deepening of China’s presence offers both opportunities and challenges. On one hand, China’s principle of non‑interference and its historical support for Palestinian self‑determination could translate into diplomatic backing at international forums. On the other hand, increased Chinese investment in infrastructure projects—such as ports and energy facilities—might prioritize state‑level economic interests over the immediate needs of occupied populations.

The episode underscores that the US‑China rivalry is not merely a distant great‑power contest; it directly influences the options available to regional actors, including the Palestinian leadership, in seeking allies and resources to advance their cause. Understanding this dynamic is essential for any comprehensive analysis of the conflict’s long‑term trajectory.

Prospects for a Post‑American Middle East

In the final segment, the correspondents contemplate whether the United States can maintain its hegemonic role in the Middle East after the Iran war. The discussion suggests that the erosion of American influence may be gradual rather than abrupt, but the cumulative effect of military entanglements, economic strain and competing great‑power interests could usher in a “post‑American” order.

Key indicators of this shift include the United States’ reduced willingness to unilaterally intervene in regional disputes and the growing autonomy of Gulf states seeking to chart independent foreign policies. The video notes that the Gulf monarchies are exploring new security arrangements, including potential cooperation with regional powers like Turkey and Iran, despite historical rivalries.

For Palestinians, a less dominant American presence could open diplomatic space for alternative mediators. Countries less tied to US strategic imperatives might be more willing to press for a fair settlement based on international law, including the right of return and an end to settlement expansion. However, the vacuum left by a retreating US could also be filled by actors less sympathetic to Palestinian rights, making the direction of the post‑American order uncertain.

The analysis stresses that the outcome will depend heavily on how regional powers balance their own security concerns with broader human‑rights considerations. The Palestinian narrative, rooted in the right to self‑determination and freedom from occupation, must therefore be amplified in any emerging diplomatic framework.

Human‑Rights Dimensions of Economic Realignments

Beyond the macro‑economic and strategic discussions, the video implicitly raises human‑rights questions tied to the war’s economic fallout. De‑dollarisation and the search for alternative trade routes can affect the flow of humanitarian aid, especially to Gaza, where the blockade already restricts the entry of essential goods.

Khan’s commentary on sanctions highlights a paradox: while intended to coerce governments, sanctions often inflict disproportionate suffering on civilian populations. The same logic applies to any future economic measures aimed at Iran or its allies. For Palestinians, who already endure movement restrictions and limited access to basic services, additional economic pressure on neighboring states could exacerbate shortages of food, medicine and construction materials.

The video’s focus on energy markets also touches on environmental and health concerns. Increased reliance on oil due to disrupted supply chains can lead to higher emissions and poorer air quality, affecting vulnerable communities in the occupied territories. Moreover, any escalation that threatens the Strait of Hormuz could trigger a surge in global oil prices, making fuel even less affordable for Palestinians already facing high unemployment and poverty rates.

These intersecting dimensions underscore the need for any policy response to consider the human cost. International law obliges occupying powers to ensure the welfare of the civilian population; thus, strategies that inadvertently worsen humanitarian conditions would contravene established legal standards.

Looking Forward: Balancing Power, Law and Justice

The “Big Picture” episode concludes by urging viewers to watch the evolving situation closely, noting that the war’s long‑term impacts are still unfolding. For journalists covering the region, the challenge lies in linking high‑level geopolitical shifts to the lived realities of people under occupation.

As the United States grapples with the limits of sanctions, as China expands its economic footprint, and as Gulf states navigate a precarious energy landscape, the Palestinian struggle remains a constant thread. The war on Iran does not exist in isolation; its reverberations touch the daily lives of families in Gaza, the prospects of a viable Palestinian economy, and the broader quest for a just peace based on international law.

In this context, amplifying Palestinian voices becomes not just an act of solidarity but a journalistic imperative. By documenting how each strategic decision—whether a shift away from the dollar, a rerouting of oil shipments, or a new security pact—affects the human rights of occupied peoples, reporters can help ensure that policy debates remain grounded in the principle of justice.

Ultimately, the video suggests that the future of the Middle East will be shaped by how major powers manage their competing interests while respecting the rights of those caught in the crossfire. For the Palestinian people, the hope is that a post‑American order will bring renewed commitment to the rule of law, enabling a genuine path toward self‑determination and an end to decades of occupation.

By Fatima Al-Rashid, Staff Writer

This article was produced with AI-assisted research and editorial support. Reporting is based on the source material cited below. Sources: Middle East Eye video report (14 September 2026); Middle East Eye; Global1.News