US History Home : Article of the Week #10 (Due Monday, March 23rd)

Iran may be where the US-led world order ends

American hegemony is unraveling in real time as Iran strikes Gulf states and US security guarantees prove hollow

In his monumental work “The History of the Decline and Fall of the Roman Empire”, historian Edward Gibbon argued that empires rarely collapse suddenly. Their decline is usually gradual, shaped by long-term structural changes.

Yet, history occasionally records moments when a single strategic miscalculation accelerates the process. The question worth asking is whether the United States may have approached such a moment.

The joint US–Israeli strike against Iran in February 2026 has triggered intense debate among scholars and policy observers. Military conflicts in West Asia are not unusual, but this particular episode may carry consequences far beyond the immediate battlefield. Some analysts have drawn parallels with the 1956 Suez Crisis, when Britain and France attempted to seize the Suez Canal after Egypt nationalized it.

Although the operation initially succeeded militarily, it collapsed politically after the US forced its European allies to withdraw. The crisis revealed that Britain could no longer act as an independent global power and symbolized the end of its imperial dominance.

Today, Iran strike could represent a comparable geopolitical inflection point. For more than seven decades, the US has anchored the global order, not only through military power but also through institutions, rules, and economic arrangements that have structured the post–Second World War international system. Many countries, including emerging powers, expanded economically within this framework.

China’s rise as a manufacturing powerhouse and Russia’s growing integration into global markets both occurred largely within an economic system shaped by American leadership. The legitimacy of US leadership, therefore, rested not only on strength but on the perception that the system it created produced stability and shared economic benefits. Nowhere was this arrangement more strategically important than in West Asia.

Foundations of US leadership in West Asia

West Asia has long been one of the most volatile regions in global politics. Since the creation of Israel in 1948, recurring conflicts between Israel and Arab states, along with sectarian rivalries and civil wars, have produced persistent instability. Yet the region also possesses vast oil reserves, making its political stability essential to the functioning of the global economy.

To manage this strategic environment, the US developed a security and energy framework that became central to its global influence. Beginning in the 1970s, Washington offered security guarantees to Gulf monarchies such as Saudi Arabia, Qatar and the United Arab Emirates.

In return, these states agreed to price and trade oil primarily in US dollars. This arrangement, commonly known as the petrodollar system, reinforced the central role of the US dollar in global finance while ensuring reliable energy supplies.

The relationship functioned as a strategic bargain. Gulf states received security protection in a region marked by geopolitical rivalry, while the United States secured both energy stability and financial influence.

Over time, this arrangement helped sustain economic development across the Gulf and strengthened Washington’s position as the primary external power shaping regional security.

Iran, however, has long stood outside this system. After the 1979 Islamic Revolution, relations between Tehran and Washington deteriorated sharply. Iran positioned itself as a challenger to US influence and developed networks of regional alliances with actors such as Hezbollah, Hamas and the Houthis. These relationships deepened tensions across the region and reinforced the reliance of Gulf monarchies on US security guarantees.

For decades, American strategy in West Asia rested on three pillars: containing Iran, maintaining the petrodollar system and guaranteeing the security of Gulf partners. This framework allowed Washington to shape regional dynamics while sustaining its broader global leadership.

Why the regional order may be fracturing

Recent developments, however, suggest that the foundations of this system are weakening. The February 2026 strike on Iran has raised serious questions about both the credibility and sustainability of US leadership in the region.

One major concern relates to diplomatic trust. Reports indicate that negotiations between the US and Iran were ongoing in Oman when the first strike occurred. Launching a military attack during diplomatic engagement risks undermining confidence in negotiation processes. In international diplomacy, credibility remains a crucial resource, even among strategic rivals.

The legitimacy of the operation has also been widely debated. The strike reportedly lacked formal authorization from the US Congress and did not receive approval from the United Nations Security Council. Actions that bypass established international mechanisms inevitably raise questions about the rules governing the use of force and the consistency of the international order.

More importantly, the regional consequences have highlighted growing vulnerabilities. Iran’s retaliatory actions have targeted infrastructure and strategic locations associated with Gulf states. For these governments, the episode raises a fundamental question: if the US cannot shield them from regional escalation, can it still serve as a reliable security guarantor?

These concerns have been developing gradually. In recent years, Gulf states have increasingly diversified their strategic relationships. China’s expanding economic presence in the region has created alternative partnerships that were previously limited. Through large-scale investments, infrastructure projects and energy cooperation, Beijing has steadily strengthened its position as a major economic actor in West Asia.

China has also begun to play a diplomatic role. The 2023 agreement restoring relations between Saudi Arabia and Iran, facilitated by Beijing, demonstrated that alternative diplomatic actors are emerging in a region historically dominated by American mediation.

At the same time, the economic consequences of escalating conflict could extend far beyond the Middle East. Any disruption to the Strait of Hormuz, the narrow maritime passage through which a significant share of global oil shipments pass, would push energy prices sharply higher. Oil prices exceeding US$100 per barrel would generate inflationary pressures across the global economy, affecting both developed and emerging markets.

The broader concern is that the US risks undermining the very system that once sustained its leadership. The post-war order commanded legitimacy because it appeared to promote stability, predictable rules and economic growth. If Washington is increasingly perceived as a destabilizing rather than stabilizing force, the credibility of that leadership may gradually erode.

This dynamic is already visible in the growing interest among many countries in diversifying economic and financial systems. Initiatives within the BRICS grouping aimed at reducing reliance on US-dominated financial institutions reflect a broader search for alternatives to the existing order.

Still, it would be premature to declare the end of American global leadership. The US remains the world’s most powerful military actor and continues to occupy a central position in global finance and technology. Yet hegemonic systems rarely collapse suddenly. More often, they weaken gradually as confidence in the dominant power diminishes.

The debate surrounding the February 2026 strike on Iran reflects precisely this uncertainty. If the credibility of US security guarantees continues to erode in regions that once anchored its influence, the global order may gradually shift toward a more multipolar structure. Emerging powers, regional actors and new economic coalitions will increasingly shape international politics.

Whether the events of 2026 ultimately prove to be a turning point remains uncertain. But history suggests that moments of strategic overreach can accelerate deeper transformations. For the US, the challenge will be whether it can adapt its leadership to a changing world—or risk witnessing the slow erosion and eventual passing of the very order it once built.

Kashif Hasan Khan is dean at the School of Graduate Studies and head of the Department of Economics at Paragon International University in Phnom Penh, Cambodia. He is an editorial board member at the Asian Journal of Economic Modelling (Scopus Q3) and associate editor of Crossroads of Social Inquiry at Abu Dhabi University.

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