The Unmaking of American Primacy

The decisive story of the 21st century is currently unfolding in the Persian Gulf. What was seen as another flare up between the US, Israel, and Iran has caused a structural shift in international relations. This conflict signals the weakening of the US dominated unipolar order and the rise of a fragmented, multipolar world. In this new landscape, power is measured less by military dominance than by energy security, strategic independence, and industrial strength.

Iran’s 1979 Islamic Revolution transformed it from a Western partner into a fierce opponent of Israel and the U.S. As Egypt, Jordan, and later Gulf states moved toward peace with Israel, Tehran doubled down by arming Hezbollah and Hamas while building a nuclear program it viewed as essential insurance against regime change.

Safeguarding Petrodollars

America’s involvement is not only military but deeply financial. Supporters of Israel stress the alliance’s moral and strategic value, while critics highlight the influence of the pro-Israel lobby, often seen as shaping U.S. policy at the expense of regional stability. At the core, however, lies Washington’s need to safeguard the petrodollar. For decades, global oil trade in dollars has sustained demand for the currency, underwriting U.S. deficits and military reach. Iran has consistently challenged this dominance, aligning with Russia and China both militarily and strategically. Past interventions in Iraq and Libya are often interpreted as efforts to neutralize threats to the petrodollar order.

Iran’s most potent asymmetric weapon lies in its control of the Strait of Hormuz. By granting passage to ‘friendly’ nations such as India and China while obstructing US linked vessels, Tehran has forced a fundamental reassessment of maritime security. Added to this is a psychological resilience born of deep-rooted fundamentalism and the drive to protect Islam forces that munitions cannot shatter. America’s failure to grasp this is a recurring theme from Afghanistan and Iraq, now replayed in the current conflict.

This war has exposed the imperial mindset of the United States. Across the Global South, Washington’s stance is widely seen as hypocritical. Russia is condemned as ‘cruel’ and a violator of international law for its actions in Ukraine, yet the U.S. claims moral authority while launching strikes on Iran or orchestrating the capture of leaders in Venezuela.

Critics argue that these military ventures reflect the desperate spasms of an imperial ego determined to preserve its image at any cost. Despite presiding over a superpower, President Trump’s desperation, anxiety, and insecurity are evident. His use of coarse language and unprecedented threats to annihilate entire civilizations underscore this volatility. The current two-week ceasefire appears more a manifestation of his desperation than of Iran’s defeat.

With the US trapped in the Middle Eastern quagmire, the Sino-Russian axis is gaining significant advantages. China has kept itself aloof since the conflict began. Its strategic petroleum reserve estimated at 1.3 to 1.4 billion barrels provides it a four-month cushion against the energy shocks. Beijing’s dominance over global manufacturing ensures that, even as oil prices surge, the world remains dependent on Chinese supply chains for critical transition technologies. By continuing to import Iranian oil through Hormuz and probably settling payments in yuan, China accelerates the rise of the petroyuan.

Russia has emerged as perhaps the greatest beneficiary of the war. Elevated crude prices have injected capital into its economy at a moment of fragility. The diversion of U.S. military assets toward Iran has granted Moscow breathing space in Ukraine. As European states grapple with soaring energy costs, the temptation to adopt a ‘survival first’ policy may push them toward rapprochement with Russia, sidelining Kyiv in favour of securing energy stability.

The conflict has exposed deep fissures within NATO. Several allies - including France, Germany, the UK, and Japan - have resisted involvement, while Spain and Switzerland denied U.S. requests to use their airspace for operations against Iran. This fragmentation coincides with the strengthening of the BRICS+ bloc, which has expanded to include Iran, the UAE, and Egypt, thus posing a growing challenge to the Western-led financial order.

Pragmatic Approach

India has defined its role through a pragmatic focus on national interest. Eschewing the moral policing that shaped Western responses to the Ukraine war, New Delhi has pursued calibrated multi alignment, balancing ties across rival blocs while safeguarding its priorities. Continued purchases of Russian oil, despite Western pressure and temporary U.S. tariffs, have provided a vital geoeconomic cushion. At the 2026 Munich Security Conference, EAM Jaishankar reaffirmed India’s commitment to strategic autonomy, stressing that energy choices are guided by domestic costs and risks rather than external dictates. This stance has helped India sustain one of the world’s fastest growth rates even as other major economies falter. While U.S. and Israeli vessels have faced blockades in the Persian Gulf, India’s diplomatic engagement with Tehran has secured safe passage for its ships. Since the conflict began, at least nine Indian vessels carrying LPG and crude have crossed the Strait of Hormuz without incident.

The crisis has reinforced the urgency of the Atma Nirbhar Bharat (Self Reliant India) mission. With 65 percent of its LPG and a large share of crude sourced from the Gulf, India remains vulnerable to Middle Eastern instability. The government’s excise duty cuts on fuel to offset surging prices have intensified the push for domestic resilience. Efforts now focus on accelerating deepwater exploration along the eastern coast and Andaman region, tapping an untapped hydrocarbon base of 12 billion tonnes. Capacity expansion of Strategic Petroleum Reserves has also been prioritized. Alongside, the Rare Earth Mission and the recently passed Jan Vishwas Bill reaffirm the government’s commitment to building a strong domestic ecosystem capable of shielding India from external shocks.

The global canvas is shifting with the rise of financial pluralism and the emergence of middle powers like India that refuse to take sides. In this new order, power is no longer defined solely by military might or dominance of a single currency, but by the ability to navigate a world of fractured multipolarity with clarity and resilience.

As Winston Churchill once remarked, “Never let a good crisis go to waste.” For India, this war is not merely a challenge but an opportunity to redefine its role as a leading Indo Pacific power. India’s rise will depend not just on economic strength, but on the clarity of its vision and its refusal to be bound by rigid blocs.

(The author is a Chartered Accountant with a leading company in Mumbai. Views personal.)