U.S. Intelligence Assessment Deems Iran Regime Change ‘Unlikely’ Despite Active Military Campaign
Classified National Intelligence Council report contradicts Trump administration's stated goals as energy markets weigh deterrence policy over supply disruption.
A classified U.S. intelligence assessment completed one week before joint American and Israeli strikes on Iran concluded that even a large-scale military assault would be unlikely to topple the Islamic Republic’s entrenched leadership, according to The Washington Post.
The National Intelligence Council report found that a U.S. assault would be unlikely to oust Iran’s military and clerical establishment, offering a sobering counterpoint to Trump administration officials who have described the ongoing operation as having ‘only just begun.’ The assessment was completed around a week before Israel and the U.S. launched their attack on the Islamic Republic on February 28, when the two nations began strikes targeting Iran’s leadership, security forces and nuclear programme to induce regime change.
Three people familiar with the report told The Washington Post that the intelligence community examined scenarios ranging from narrow strikes targeting Iran’s leadership to broader campaigns against government institutions. In both cases, the National Intelligence Council concluded that Iran’s clerical and military establishment would follow protocols to preserve continuity of power in the event of Supreme Leader Ayatollah Ali Khamenei’s death, with the possibility of Iran’s opposition taking control described as ‘unlikely.’
Khamenei was killed in an Israeli airstrike on February 28 during the opening hours of Operation Epic Fury. More than 1,300 people in Iran have been killed in the first week of fighting, according to the Iranian Red Crescent Society. The U.S. and Israel have achieved air supremacy, with Pentagon officials stating Iran’s navy and air force have been largely destroyed.
Deterrence, Not Decapitation
The intelligence assessment underscores a fundamental tension in U.S. policy: Washington’s long-standing reliance on deterrence by denial – preventing Iranian attacks through defensive measures and forward-deployed assets – rather than punishment through offensive strikes. Deterrence by denial works by convincing the adversary that it will be thwarted; the United States has increasingly relied on this approach in recent years to counter Iran’s destabilizing regional activities, bolstering regional air and missile defences and standing up maritime task forces.
The report arrives as President Trump demands Iran’s ‘unconditional surrender’ while simultaneously asserting a role in selecting the country’s next supreme leader. Iranian authorities announced the formation of a three-member transitional council to manage state affairs, with Mojtaba Khamenei, the son of Iran’s late Supreme Leader, emerging as a leading contender.
Energy markets appear to be pricing deterrence policy rather than regime collapse. Traders demand about $14 more for a barrel of oil than before the conflict to compensate for increased risks, roughly corresponding to the effect of a full four-week halt in flows through the Strait of Hormuz, according to Goldman Sachs Research. Oil prices rose above $79.40 per barrel on Monday, after hitting $73 per barrel on Friday.
The Hormuz Variable
About one-fifth of global oil and petroleum product consumption flows through the Strait of Hormuz, averaging 20 million barrels per day in 2024, according to the U.S. Energy Information Administration. China, India, Japan, and South Korea account for nearly 70 percent of shipments passing through the strait. Traffic is down at least 80 percent, Michelle Bockmann, a senior maritime intelligence analyst at Windward, told Al Jazeera.
The Strait of Hormuz is crucial for nearly 20 million barrels per day of global oil production, with Saudi Arabia, Iraq, and the United Arab Emirates together exporting 13.1 million barrels per day via the strait last year. The International Energy Agency estimates that 4.2 million barrels per day of oil flows through the Strait can be redirected using existing spare pipeline capacities, implying around 16 million barrels per day of oil flows are at risk from a full closure.
Qatar ceased most of its liquefied natural gas output this week, then Iraq and Kuwait began shutting down production from their oilfields, with the United Arab Emirates and Saudi Arabia potentially following suit, Fortune reported. The problem is the effective closure of the Strait of Hormuz because of the war in Iran, giving many Gulf energy producers few export outlets for their barrels, which sets off a chain reaction with domestic storage filling up and forcing the shuttering of production.
| Scenario | Brent Price ($/bbl) | Duration |
|---|---|---|
| Quick resolution | $60-70 | Days |
| Current risk premium | $79-83 | 1-4 weeks |
| Extended disruption | $91-100 | Months |
| Full Hormuz closure | $200 | Sustained |
Policy Contradiction
The intelligence assessment reveals a disconnect between analytical consensus and operational objectives. American intelligence agencies believe Iran would not have had missiles capable of reaching the U.S. for another nine years, until 2035, according to ABC News, contradicting Trump’s public justification that the U.S. was ‘very nearly under threat.’
Matthew Duss, executive vice president at the Center for International Policy, stressed that air strikes alone cannot collapse the Iranian ruling system, noting ‘we don’t have examples of when air power alone has achieved regime change’. The 2011 NATO campaign in Libya required ground forces from Libyan rebels to dislodge Muammar Gaddafi.
Trump has privately expressed interest in deploying ground forces to Iran, according to NBC News, with sources saying the president hasn’t discussed a major ground offensive but instead sending a small group of U.S. forces to carry out missions with specific strategic purposes. A recent Reuters survey suggested that only about one-quarter of Americans support the war.
- U.S. intelligence concluded regime change in Iran is unlikely even with large-scale military assault, contradicting administration goals
- Energy markets pricing $14 per barrel risk premium, equivalent to four-week Hormuz closure scenario
- 80% reduction in Strait of Hormuz traffic forces Iraq and Kuwait to shut oil production as storage fills
- Iran’s 3.2 million barrels per day production represents 4% of global supply; Hormuz carries 20% of global consumption
- Intelligence community assessed Iranian succession protocols designed to preserve regime continuity
What to Watch
The duration of disruption through the Strait of Hormuz will determine whether the current risk premium reflects fair value or requires significant repricing. The critical variable is the duration of the conflict, according to KPMG’s U.S. energy strategy leader Angie Gildea. If hostilities extend beyond several weeks, U.S. consumers would likely see gasoline prices rise above $3 per gallon, pushing inflation modestly higher while weighing on consumer confidence and spending, complicating the Federal Reserve’s decision making around future rate cuts.
Track Iranian crude export figures from alternative routes and monitor whether Saudi Arabia’s increased crude oil shipments through the Red Sea – currently modest volumes – can be expanded. Trump said on Monday that the war will likely last up to five weeks, but will continue as long as necessary to achieve U.S. objectives. The gap between that timeline and intelligence assessments of regime durability suggests either a policy recalibration or a protracted conflict with compounding economic consequences.