Shortly after midnight on June 17, the sound of sirens cut through the streets of Tehran as reports emerged that US President Donald Trump and Iranian President Masoud Pezeshkian had electronically signed a memorandum of understanding designed to bring an end to the US-Israeli war against Iran.

Along Valiasr Street, young men leaned out of car windows, waving Iranian flags. Families gathered in cafés that had remained half-empty during months of war and economic uncertainty. The celebrations were not exuberant enough to suggest victory, but neither were they subdued. For many Iranians, simply surviving what had increasingly appeared to be an existential confrontation with the US and Israel felt like an achievement.

“It is not peace,” said Reza, a trader in Tehran’s Grand Bazaar. “But at least we are alive, and Iran is still standing.”

More than 1,500 kilometres away in Doha, the mood was markedly different. There were no jubilant crowds or victory chants. Relief, rather than celebration, defined the moment.

For weeks, Gulf residents had lived under the shadow of a conflict that threatened the world’s most vital energy route. The economic consequences were already visible. Doha’s normally crowded international airport had witnessed an unusual slowdown since February as airlines cut services, travellers postponed plans, and fears of a broader regional confrontation mounted.

Tankers were rerouting, insurance costs were soaring, and closure of the Strait of Hormuz had begun affecting everything from shipping schedules to investor confidence. “People here suddenly realised how vulnerable the Gulf really is,” said a Qatari academic. “For decades, everyone assumed that prosperity and security were permanent. This war showed how fragile both can be.”

In the Turkish capital of Ankara, officials were quietly satisfied. Turkish diplomats had spent months arguing that military escalation could not resolve the region’s disputes. Alongside Qatar and Pakistan, Türkiye played a behind-the-scenes role in encouraging negotiations and regional diplomacy. Turkish officials now see the agreement as vindication of a long-held belief that dialogue, however frustrating, ultimately produces more durable outcomes than military campaigns.

Yet in Tel Aviv, the atmosphere could hardly have been more different.

Outside a café near Rabin Square, conversations quickly turned from the agreement itself to what many Israelis viewed as a betrayal. “We were told Iran would be defeated,” said Eyal, a reserve officer recently released from military service. He refused to share his full name. “Now Iran survives, Hezbollah survives, and Trump is making deals.”

Among supporters of Prime Minister Benjamin Netanyahu, the sense of disappointment is even deeper. For months, they were told that Israel and the US were together reshaping West Asia. The war was presented not simply as a military campaign but as the culmination of a broader strategic project that would finally neutralise Iran and fundamentally alter the regional balance of power. Instead, President Donald Trump abruptly changed course and embraced a memorandum of understanding that many Israelis believe leaves Iran bruised but intact.

Visible contrasts

The contrasts are striking. In Tehran, people celebrate survival. In Doha, they celebrate stability. In Ankara, they celebrate diplomacy. In Tel Aviv, many fear strategic defeat.

Those differing reactions reveal the true significance of the US-Iran memorandum. This was never merely an agreement about uranium enrichment, sanctions relief, or the reopening of the Strait of Hormuz. It was a decision about the future balance of power in West Asia. And at its heart lay a political calculation made in Washington.

Experts say that Trump had a choice. He could continue backing Israeli Prime Minister Benjamin Netanyahu’s campaign against Iran, risking a prolonged regional war, spiralling oil prices, and growing political damage at home. Or he could cut a deal with Tehran, stop the bleeding in global markets, and head into the November midterm elections claiming he had restored stability.

Speaking after the framework agreement was reached, Trump revealed what many officials had privately feared for weeks: the global economy was approaching a breaking point.

The closure of the Strait of Hormuz had pushed energy markets into panic. According to officials familiar with the negotiations, Washington’s calculations showed that available reserves could cover only a few weeks of sustained disruption. “The world would have turned upside down economically,” Trump remarked. That statement, more than any diplomatic formula, may ultimately explain the sudden American turn.

For weeks, the White House publicly framed the war in strategic terms. Officials spoke of dismantling Iran’s military capabilities, preventing a nuclear weapon, and weakening Tehran’s regional network of allies. But as oil prices surged, inflation rose, and Gulf economies began feeling the consequences of paralysis in the world’s most important energy corridor, the political equation changed.

According to several analysts in Washington, by June, the choice confronting Trump was no longer primarily about Iran. A prolonged war threatened fuel prices, economic stability, Republican prospects in the November midterm elections, and Trump’s own political standing. In their assessment, Netanyahu’s ambition to reshape West Asia through military force increasingly collided with Trump’s need to reassure American voters worried about prices at the petrol pump.

The result was an agreement that stunned Israel, relieved much of the Gulf, divided Iran’s political establishment, and exposed perhaps the most serious strain in US-Israel relations in decades.

Larger project behind war

The memorandum includes provisions to reopen the Strait of Hormuz, launch a 60-day negotiating process on Iran’s nuclear programme, provide a framework for sanctions relief, and create a pathway towards a proposed $300 billion reconstruction and development fund intended to attract investment into Iran. It also includes provisions concerning Lebanon’s territorial integrity and new standards governing Iran’s stockpile of highly enriched uranium. The actual text of the MoU reportedly mandates a “toll-free” window for 60 days but does not explicitly settle what happens regarding charges thereafter. This ambiguity has left the long-term status of the waterway as a major point of contention for the upcoming peace negotiations.

Yet the significance of the agreement lies less in its text than in what it represents politically. West Asia analyst David Hearst argues that the war was never solely about Iran’s nuclear programme. Rather, it formed part of a broader project to reshape West Asia after the Hamas attack of October 7, 2023.

That project envisaged a region in which Israel emerged as the dominant military and strategic power, Iran’s influence was rolled back, the Abraham Accords were expanded, and Saudi Arabia would eventually join a US-backed regional architecture centred on Israel. In this interpretation, the conflict was about determining who would shape West Asia for the next generation.

That vision now appears considerably more distant. Iran’s government not only remains in power, but its missile programme survives, and nuclear infrastructure remains unresolved. Tehran has emerged from the conflict politically stronger than many of its adversaries expected.

Israeli military analyst Alon Ben David described the outcome as a turning point. Before the war, he argued, Israel could reasonably claim to be the region’s dominant military power with American backing. After it, Iran may emerge as the region’s most significant political force.

Amos Harel of Haaretz called the agreement Netanyahu’s biggest strategic setback since the Hamas attacks of 2023.

Even within Israel’s security establishment, doubts are becoming increasingly evident. A senior Israeli official told Frontline that had decision-makers known the political outcome beforehand, Israel might never have launched the operation. “If we had known these would be the final results,” the official said, “it is highly doubtful that we would embark on this venture.”

Such remarks would have been almost unimaginable a few months ago.

Backlash in Israel

While Netanyahu continues to insist that the campaign achieved its objectives, a growing number of Israelis are questioning whether those military achievements translated into political gains.

Former Prime Minister Naftali Bennett warned that Iran remains a threat. Israel’s Leader of the Opposition, Yair Lapid, accused Netanyahu of leaving Israel with an impossible choice between confronting its most important ally or accepting restrictions on its security policy.

Channel 14 personalities who once praised Trump’s West Asia team have turned sharply against them. Steve Witkoff and Jared Kushner, previously viewed as trusted friends of Israel, suddenly found themselves accused of prioritising an American diplomatic success over Israeli security concerns.

What makes the backlash unusual is that it is directed not only at Tehran but increasingly at Washington. For decades, Israeli governments had assumed that, however serious disagreements became, the US would ultimately align itself with Israel’s strategic objectives.

Gideon Levy, who is among Israel’s most respected commentators, has offered perhaps the most nuanced assessment. He welcomed any ceasefire after years of bloodshed but warned that the agreement rests on unstable foundations. According to Levy, Iran successfully linked developments in Lebanon to the broader negotiations.

But he warned that ambiguity surrounding Israel’s future actions in Lebanon leaves significant room for misunderstanding and escalation. “Only time will show if we are reaching a new era,” he observed, “or merely entering another phase of the ongoing war.” His caution is widely shared among analysts across the region.

Tehran’s uneasy victory

Officially, Tehran is in a celebratory mood. President Masoud Pezeshkian has portrayed the memorandum as proof that Iran’s policy of resistance compelled its adversaries to seek a negotiated settlement. Former Foreign Minister Mohammad Javad Zarif hailed the deal as a significant diplomatic achievement.

But beneath the public celebrations lies a more complicated reality. The agreement has triggered unease among sections of Iran’s conservative establishment. Hardline newspapers and several lawmakers have questioned whether the concessions made by Tehran outweigh the benefits secured. The debate reflects a deeper divide over how Iran should balance resistance with diplomacy in dealing with the US and its allies.

Kayhan, the Persian-language newspaper published in Tehran, warned that Iran may be exchanging strategic leverage for uncertain promises. Several parliamentarians accused negotiators of repeating mistakes associated with the 2015 nuclear agreement.

One of the least discussed aspects of the agreement is the growing importance of regional diplomacy. Qatar and Pakistan played key mediating roles. Türkiye quietly supported the process. Saudi Arabia and Egypt increasingly favoured de-escalation. Together, these countries represent an emerging diplomatic alignment that prefers negotiation over permanent confrontation.

For years, Gulf security rested on the assumption that American military power guaranteed regional stability. Iran demonstrated its ability to disrupt shipping, energy flows, and commercial activity despite the presence of extensive American military infrastructure. The lesson was not lost on Gulf leaders. Increasingly, regional governments appear to believe that coexistence with Iran may be more realistic than endless confrontation.

Former Indian Foreign Secretary Nirupama Rao recently observed that regional politics is entering an era in which middle powers and regional actors are becoming increasingly influential in shaping outcomes that were once determined primarily by great powers.

For much of the past decade, Israeli policymakers and their supporters in Washington promoted a vision of a new West Asia built around the Abraham Accords. The idea was simple: Israel would become the region’s central strategic partner, Arab states would gradually normalise relations, and Iran would be isolated politically, economically, and militarily.

The normalisation agreements signed with the UAE and Bahrain in 2020 were viewed as the first stage of that project. Morocco and Sudan followed. The ultimate prize, however, was always Saudi Arabia.

Israeli officials believed that a combination of economic integration, security cooperation, and American guarantees would eventually persuade Riyadh to join the process formally. The events of the past two years have complicated that vision.

The Gaza war dramatically altered Arab public opinion. Images of destruction and civilian suffering made it politically difficult for Arab governments to deepen visible ties with Israel. Even countries that maintained relations increasingly found themselves balancing strategic interests against domestic pressure. The war with Iran accelerated that shift.

Rather than demonstrating Israeli dominance, the conflict exposed the limits of military power. Iran survived. Its regional network survived. The Gulf states found themselves vulnerable to economic disruption. And Washington ultimately chose de-escalation over escalation.

As British military analyst Andrew Fox recently observed, Gulf leaders have reached a sober conclusion. Whatever damage Iran suffered, it remains a permanent feature of the regional landscape. Attempts to isolate it completely or engineer its collapse no longer appear realistic.

That does not mean Arab governments have suddenly become pro-Iranian. Many still view Tehran as their principal security challenge. But they increasingly see dialogue, deterrence, and coexistence as more practical than permanent confrontation.

Changing outlook

This changing outlook helps explain the growing importance of a loose diplomatic grouping involving Saudi Arabia, Türkiye, Egypt, Qatar, and Pakistan.

During the war, foreign ministers and senior officials from these countries maintained frequent contact. While their interests do not always align, they share a common concern about regional instability and a common preference for political solutions over prolonged conflict.

For Israel, this presents a new challenge. The region it hoped to lead is becoming increasingly multipolar. Instead of a West Asia organised around a single US-backed security architecture, a more fluid balance is emerging. Regional powers are asserting greater independence. Gulf states are diversifying partnerships. Türkiye is expanding its diplomatic reach. Pakistan has demonstrated unexpected relevance as a mediator.

Nirupama Rao argues that this reflects a broader transformation in international politics. As global power becomes more dispersed, regional actors are gaining greater influence over outcomes that were once largely determined by Washington, Moscow, or Beijing. The US-Iran memorandum may ultimately be remembered as one of the clearest examples of that shift.

The West Asia that is now emerging is less ideological, more transactional, and increasingly shaped by regional actors seeking stability rather than confrontation. For years, Netanyahu built his regional vision around American power and Israeli military superiority. Both remain formidable assets. But the region around them is changing.

Several Israeli historians have noted that the 1973 war shattered Israel’s sense of invincibility that had emerged after its decisive victory in the 1967 Six-Day War. It, however, later helped Israel to make peace overtures leading to the Camp David Agreement with Egypt and then the Oslo Accords with Palestine and recognition of the Two-State Formula. But as Israel regained its illusion of invincibility, it almost withdrew from the peace accords with the Palestinians.

Although support for Israel remains strong in the US, it has become increasingly polarising. The Gaza war transformed public debate. Younger voters view the relationship differently from previous generations.

Indeed, the memorandum does not resolve every dispute or answer all questions surrounding Iran’s nuclear future. It does not settle Gaza. It does not disarm Hezbollah. It does not guarantee peace in Lebanon.

What it does, many regional analysts argue, is acknowledge a reality that military campaigns failed to deliver the political outcomes sought by their architects. It also demonstrates that even Washington’s closest alliances remain subject to domestic political calculations.

The question remains whether Trump’s decision to prioritise domestic political considerations over long-standing alignment with Israel will prompt a broader reassessment in Tel Aviv and encourage Israeli leaders to revisit earlier peace frameworks and implement measures that allow Palestinians greater political and economic space.

Iftikhar Gilani is an Indian journalist based in Ankara.

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