The U.S.-Iran conflict is settling into a 'forever war'—a protracted, low-intensity struggle—rather than a short, decisive engagement.
Iran has learned to use its control over the Strait of Hormuz and its Houthi proxies as low-cost, high-impact tools to inflict global economic pain.
China is actively weaponizing its dominance in critical supply chains, such as renewable energy and minerals, to strategically counter U.S. policy.
The war in the Middle East is creating a critical strategic drain on U.S. military resources, undermining its ability to focus on the Indo-Pacific and reassure Asian allies.
President Trump's ambiguity on Taiwan arms sales represents a significant and destabilizing deviation from established U.S. policy.
March 31, 2026
Welch analyzes the initial phase of the U.S.-Iran conflict, highlighting Iran's discovery of its low-cost leverage over the Strait of Hormuz and its unacceptable peace terms, including sovereignty over the strait.
May 11, 2026
As the conflict continues, Welch reports on a significant U.S. military presence (three aircraft carriers) but predicts the situation will evolve into a 'protracted, low-intensity conflict' for the coming weeks or months.
May 21, 2026
Welch expands her analysis to the global implications of the Hormuz crisis, suggesting it could set a precedent for tolls in other chokepoints like the Malacca Straits and reiterates a full reopening is unlikely without a peace deal.
Post-Trump China Trip (Undated)
Welch's focus shifts to the secondary effects of the Middle East war, detailing how it diverts U.S. resources from the Indo-Pacific and analyzing President Trump's ambiguous policy on Taiwan arms sales amidst China's economic restrictions.
Escalation Phase (Undated)
Welch reports on Iran directing its Houthi partners to disrupt Red Sea shipping, framing it as a deliberate escalation to inflict further economic pain and causing U.S. Gulf allies to question their security relationship.
▶Iran's Asymmetric Leverage via Maritime ChokepointsApr–Jul 2026
Welch's analysis centers on Iran's discovery that it can control critical waterways like the Strait of Hormuz at a relatively low cost. She details how Iran directs proxies, such as the Houthis in the Red Sea, to amplify this strategy, creating multiple points of economic pain for the global economy.
Investors should price in persistent volatility in shipping and energy markets, as Welch's analysis suggests these disruptions are a core, repeatable element of Iranian statecraft, not a temporary crisis.
▶China's Geoeconomic CountermovesMay–Jul 2026
Welch identifies China's strategic use of its dominant position in key global supply chains. She points to China's 'chokehold' over renewable energy supplies and its export restrictions on critical minerals for U.S. defense end uses as deliberate measures to frustrate American de-risking and diversification efforts.
Analysts must consider that U.S. efforts to build resilient supply chains will face active, targeted economic countermeasures from Beijing, increasing costs and timelines for strategic industries like defense and green energy.
▶U.S. Foreign Policy Ambiguity and Resource StrainMay 2026
Welch highlights a shift in U.S. foreign policy under President Trump, characterized by ambiguity towards allies and deviations from precedent, particularly regarding Taiwan arms sales. She argues the Middle East conflict exacerbates this by diverting essential military assets, like missile defense systems, away from the Indo-Pacific, straining U.S. strategic commitments.
The dual pressures of a Middle East conflict and Indo-Pacific competition create significant execution risk for U.S. foreign policy, suggesting that allies may hedge their bets and U.S. strategic goals in both regions could be compromised.
▶The 'Forever War' in the Persian GulfMay–Jul 2026
Welch consistently frames the U.S.-Iran conflict as a 'low-intensity, protracted conflict' with no clear end in sight. She notes that Iran's peace terms are unacceptable to the U.S. and that internal estimates suggest Iran's economy can withstand the current blockade for months, pointing towards a long-term stalemate rather than a decisive outcome.
Defense and energy sector forecasts should model a sustained, low-grade conflict as the baseline scenario, rather than anticipating a return to pre-conflict stability or a full-scale war.