Iran War destabilises, divides, and humiliates Europe

Economically devastating and politically destabilising, Trump’s war against Iran has catastrophic implications for Europe. It is a disaster that the declining and deindustrialising powers of the continent absolutely cannot afford.

From the very outset, they were reluctant to get involved, with each country trying to keep Trump on side without getting directly involved in the war effort. But as the crisis has spiralled further out of control, one European country after another has been forced to distance themselves from America. 

They are caught between a rock and a hard place, not wanting to be seen as helping Trump in his war, while at the same time not wanting to alienate Trump himself. Starmer is now organising a ‘summit’, in effect a phone call, of 35 countries to discuss helping to reopen the Strait of Hormuz… after a ceasefire, i.e. when the war is over!

However, this belated stand has infuriated Trump. He is once again threatening to withdraw America from NATO with the excuse that the US has not received the help he requested. He has been pummelling his ‘allies’ with a relentless barrage of humiliating insults.

Threatened on one side by a war over which they have no control, and on the other by their attempt to stay out of it, the position of the Europeans is impossible. More than ever, the Iran War is exposing their weakness, impotence and division before the entire world. 

Economic catastrophe

In the past, the Europeans had something of a role to play. It was the EU that brokered the Iran nuclear deal, which was touted as its greatest diplomatic achievement… until Trump tore it up.

Today, they have zero influence. When Trump decided to bomb Iran, he gave the Germans and Poles a few minutes’ notice and left the rest to find out from the news. 

Now the entire Middle East has been destabilised. All of their assets and investments in the region are in jeopardy, and potentially millions of refugees are being forced in their direction. Most of all, the economic impact threatens to hit them like a natural disaster.

Dependent on imports for 60 percent of its electricity, Europe has long been vulnerable to shocks in the world energy market. But it was left wide open by the Ukraine War, which blew up the continent’s supply of cheap Russian oil and gas. Since then, Europe has been struggling under some of the highest energy prices in the world – whereas US consumers pay $48 ​per MWh, EU prices average $120.

Now the Strait of Hormuz is being strangled and the world is facing “the biggest energy crisis in history”, according to the International Energy Agency. European gas prices have already leapt by over 70 percent and oil is over $100 a barrel. This at a time when European energy storage is at record lows.

And it’s not just energy. Flights, tankers, Asian raw materials – the price of everything that Gulf oil and gas fuels is rocketing up. So are its derivatives: the globally significant quantities of urea (used for fertiliser), helium (used for semiconductor production) and sulphur that the Gulf states produce have been cut off. Prices will inflate across the board. 

While most of the oil and gas that passed through the Strait of Hormuz was destined for Asian markets, the Houthis have now entered the war on the side of Iran. Should they close another narrow waterway, the Bab-el-Mandeb Strait to the Red Sea, transport costs to Europe will rocket up even further. Worse could still come if Trump escalates out of desperation and Iran and its allies respond in kind.

Prior to this war, stagnant Europe had been deindustrialising under the pressure of relentless Chinese competition, tariffs and the last bout of high energy prices and inflation. This new war will massively accelerate that process.

One German chemical producer revealed that the Ukraine War increased their monthly energy bill from €6 million to €10 million. That shock resulted in an 80 percent drop in investment and a sixfold increase in factory closures across the chemical sector. Now the same chemical producer is looking at monthly bills of €17 million. Another said outright: 

“If today’s economics were to stay in place for the next three months, I would shut down my [UK] facility and I’d be importing product from China or the US.”

Prospects for European capitalism were already looking grim. But this war will liquidate their already meagre forecasts of growth. Goldman Sachs estimates that a sustained increase of 10 percent in oil prices typically raises inflation by 0.2 and decreases economic growth by 0.1 percent. Oil prices are up 60 percent so far.

And what tools does Europe have to deal with this? Price caps and subsidies will plunge them all hundreds of billions of euros deeper into debt. Even before this war, the average EU debt-to-GDP ratio was 80 percent, and was predicted by the IMF to double by 2040. Raising interest rates to control spiralling inflation will make those debts weigh even heavier.

And who will supply the rest of their energy? Russia has vast supplies of crude oil, for which business is booming. The US, which was recently imposing tariffs on other countries for buying it, has now ‘temporarily’ lifted sanctions in order to keep prices low. The Russians emerge enormously strengthened from this.

Already, Belgium’s prime minister has broken ranks to suggest that Europe normalise relations with Russia in order to get at its cheap energy. In other words, the proxy war in Ukraine has ended in a miserable failure. And now the Russians are preparing a new spring offensive at a time when the flow of weapons to Ukraine is being diverted by the Americans to resupply themselves and Israel. Putin is in a very strong position. Reflecting on the fact that the Europeans just a few months earlier voted to cut off all Russian gas by 2027, he joked: 

“Now other markets are opening up, and perhaps it’s more advantageous for us to stop supplying the European market right now.”

In the end, he may prove willing to supply the Europeans with the energy they need, but in exchange he would exact an enormous price. The only other option is for Europe to become even more dependent on American energy, paying much higher prices. 

Who will be forced to pay for all this? The workers of Europe – who have had no say in any of this – through more inflation, more austerity, and more unemployment.

This is intolerable, especially given the war’s overwhelming unpopularity. This is Trump’s war, Israel’s war, and in the minds of millions, a war to distract from the Epstein files. Given their response to the European imperialists’ collaboration in the Gaza genocide, they will not take this lying down. The overt involvement of the Europeans in this latest crime would have enormous consequences for the class struggle. 

In short, this war in Iran is, on every level, a disaster of epic proportions for European capitalism. As much as all of their ruling classes in principle support America and Israel’s right to rain “death and destruction” on Iran, the economic and political implications are affecting all of their calculations. In Britain, even the Tories and Reform were forced to tone down their gung-ho, pro-American attitude – the war has become a cost-of-living question. They are having to think of their ‘national interests’ which do not line up with those of the US.

European disunion

Having unilaterally created this mess, Trump expected his European allies to help clean it up. First and foremost, that meant levying the vast network of American bases on European soil.

Having unilaterally created this mess, Trump expected his European allies to help clean it up. First and foremost, that meant levying the vast network of American bases on European soil / Image: Heritage Foundation

Given the scale of the disaster this was sure to create, one might have expected a united and unanimous ‘no’ from the Europeans. On the contrary, at the outset, it was every man for himself.

NATO’s Mark Rutte and the EU’s von der Leyen – whose raison d’etre is keeping ‘Daddy’ happy – immediately came out in full support of Trump. Without consulting any of the member states, Rutte boasted of NATO’s “massive support”, and von der Leyen pledged “our” support to “a credible transition” (i.e. regime change). But as one European diplomat complained, “Who is we?”

The ‘powerful’ E3 (Britain, France and Germany) countries and Italy began by issuing meek statements in which they insisted that this is “not our war”, urged de-escalation and condemned… Iran, without a single word against the unprovoked and brazenly predatory attack by US and Israeli imperialism. 

Under pressure from the fact that only 16 percent of British people support the war, Keir Starmer went so far as to refuse America the use of its shared base in the Chagos Islands. Well, he tried to. Unfortunately for Starmer, Britain’s ‘special relationship’ with the US means that it is not really independent. All it took was one angry phone call from Trump, and the next day this American lapdog was out defending British bases being used to “defensively” bomb Iran, while harping about “the lessons of Iraq” and the need for “a lawful basis, and a viable thought-through plan”.

In Spain, Pedro Sánchez was much more consistent. He has clearly sought to make political capital out of opposition to the war, stating: 

“It is absolutely unacceptable that those leaders who are incapable of [improving people’s lives] use the smoke of war to hide their failures and, in the process, line the pockets of a few.” 

The US was forced to move its bombers from Spanish bases. When Sánchez came under pressure from Trump, he doubled down against the “disaster” and criticised the “blind and servile obedience” of his European allies.

As for Germany, Merz was sitting right next to Trump when he issued his reviews of these  “terrible” Europeans. Trump attacked Starmer as “no Churchill” and threatened to cut off trade with Spain altogether. Not only did Merz not leap to defend his neighbours – he joined in! 

He admitted the war was “obviously” illegal… but that international law should not apply to Iran! “Now is not the time to lecture our partners and allies”, Merz told the media before his audience with Trump. “For all our doubts, we share many of their goals – even if we are not in a position to achieve them ourselves.”

This candidly states the case of all the Europeans, who have been collaborating in imperialist aggression against Iran for years. It’s the means they ‘doubt’, not the ends.

Back home – without Trump breathing down his neck – Merz reassured his electorate that Germany would stay well away from the war, warning that it would have a massive impact on energy costs and trigger large-scale migration. But nonetheless, Merz’s words caused a ruckus in the EU. The Spanish Deputy Prime Minister attacked Germany as a “vassal” of the US, and EU bureaucrats, panicking, went rushing around trying to mend relations.

Behind the scenes, most of them did agree – if reluctantly – to passively collaborate, by allowing the US to use its bases on their soil. Given the destruction of US military bases throughout the Middle East, these are currently proving vital for America in its conduct of the war. But whereas Merz was more than happy to pay tribute, Meloni and Macron – fearful of the social consequences of complicity – agreed only on the proviso that the bases would be used for ‘defence’ and logistics. 

As the conflict spiralled out of American control, however, Trump, desperate to extricate himself from the catastrophe, began to demand the European’s active and "enthusiastic" engagement in his adventure.

As the conflict spiralled out of American control, however, Trump, desperate to extricate himself from the catastrophe, began to demand the European’s active and "enthusiastic" engagement in his adventure / Image: own work

Unwilling to risk US battleships in unblocking the Strait of Hormuz, the 34km-wide bottleneck that is currently garrotting the world economy, he demanded the Europeans do it for him. This would, of course, be a suicide mission. No big naval presence could prevent the Iranians from firing endless drones at any maritime traffic attempting to navigate the Strait.

So insane was this request that he temporarily succeeded in uniting them. The EU put out a unanimous statement rejecting his command to unblock the Strait… until the war is over. 

But even this timid attempt at independence was enough to send Trump through the roof. Lindsey Graham said he had “never heard him so angry in my life.”

Ever since, he’s been firing a continuous volley of insults against the European “COWARDS”, singling out Keir Starmer for particularly harsh abuse. He thundered on Truth Social:

“You’ll have to start learning how to fight for yourself, the U.S.A. won’t be there to help you anymore, just like you weren’t there for us.”

Such public humiliation – alongside the ever-spiralling political and economic consequences of the war – has forced the Europeans to take a harder stance in staying at arms’ length. Now they are backtracking on even passive support. This week, Spain closed its airspace to US bombers entirely. France has prevented Israeli planes from flying over its territory. Italy blocked US planes from landing at their base in Sicily. And now the AfD is calling for the complete withdrawal of US troops from Germany.

America: can’t live with ‘em, can’t live without ‘em

Transatlantic relations are at breaking point. NATO is openly divided. For America, that is a frustrating hindrance in its attempt to destroy Iran. But for Europe, it is existential.

Their ‘year of appeasement’ – which saw them obediently bend through one-way tariffs and the threat to annex one of their colonies – has totally failed. Their self-abasement has not changed the fact that their old ally is both a massive liability, dragging them from crisis to crisis, and increasingly hostile.

They are being shaken awake to a future of Europe without America – without its military support, its intelligence, or its nuclear shield. Even worse, souring relations with Europe make it more likely that America will push for an agreement with Russia and withdraw support for the Ukraine War, on which the Europeans have suicidally pinned all their hopes.

They are being shaken awake to a future of Europe without America – without its military support, its intelligence, or its nuclear shield / Image: own workWithout America, the Europeans will be left to shoulder the aftermath: a failed Ukrainian state on their border and, beyond it, a resurgent, powerful Russia, with a million-strong, battle-hardened army. Amid acute economic, social and political turbulence all across the continent, European capitalism cannot afford any of this.

This is amplifying cries for Europe to unite and go its own way. Macron, long a champion of what he calls “European strategic autonomy”, has used the crisis in the Middle East to posture France as its spearhead. When Britain’s base in Cyprus was bombed, its weakened navy could only spare one ship, which would be one week late. Instead, it was France that organised a few ships and anti-missile systems to defend bases in Cyprus. Simultaneously, Macron has offered France’s nuclear arsenal of around 300 warheads for the other European powers to huddle under, now that America’s cannot be taken for granted. Russia, in contrast, possesses the world's largest nuclear arsenal with well over 5000 warheads.

A section of the French capitalist class has suffered from delusions of grandeur since the days of de Gaulle. They imagine themselves as a serious independent military power that could play the dominant role on the continent without the US. This is a fantasy: France cannot replace America.

For the last century, the lynchpin of Europe’s prosperity, stability and unity has been its privileged alliance with the foremost military and economic power in history. Without its undisputed leadership, without the ‘peace dividend’ American support enabled, the European Union will find itself facing an existential threat. 

It will be forced to massively increase military spending in a desperate attempt to replace the defensive cover the United States used to provide. This will mean even more drastic cuts to social spending, adding to the social and political instability in every European country. Given their different economic strengths and their different levels of debt, Europe risks being torn apart, with different fragments drifting in different directions, each of them declining and deindustrialising, each increasingly squabbling to secure their puny national interests against their neighbours. That leaves the Europeans easy prey for the great powers that are redividing the rest of the world.

Ultimately, no one knows how far Europe will be dragged into the widening vortex of war. So far, a French soldier has been killed and an Italian fighter jet blown up. The US and Israel will continue to apply pressure. They used, for example, Iran’s alleged attack on the US-UK Diego Garcia base to bully them into getting further involved, as it put ‘Europe in range of Iran’.

No one can say how long this war will drag out. The latest statements of Trump are not reassuring. He says that the war could be over within a couple of weeks. But it could go on for much longer, and even escalate. But whatever happens, the war is accelerating all the preexisting tendencies of European capitalism towards decline, and accelerating the break-up of the so-called ‘West’. 

The workers of Europe will suffer the consequences of all this in the form of a severe decline in their living conditions, in job losses, in a cost-of-living crisis and in the breakdown of the very fabric of society. At the same time, this is preparing an unprecedented period of class struggle, in which the working class will be posed with the task of ending the system that has created the present nightmare.