Larry Elliott: Conflict with Iran risks Boer War-style hollow triumph portending empire’s demise
When American and Israeli warplanes began their campaign against Iran, the assumption in many Western capitals was of a swift, decisive demonstration of supremacy. The reality, several months into a grinding conflict, is proving far more complex and costly, drawing uneasy parallels with a historical shock to imperial confidence: Britain’s long, painful war against the Boer farmers of South Africa over a century ago.
The economic shockwaves are now rippling globally with unprecedented speed. The price of Brent crude oil has surged by 50% since hostilities began, surpassing $100 a barrel and reaching a peak of $126 in early March 2026—the highest in four years and a faster surge than seen in any recent conflict. The primary cause is the effective closure of the Strait of Hormuz, a critical chokepoint through which approximately 20% of the world’s daily oil supply flows. Market analysts describe this as the largest disruption in the history of the global oil market, comparable in scale to the 1970s energy crises.
A Costly Historical Precedent
The analogy with the Second Boer War (1899-1902) is stark. That conflict, triggered by British imperial ambition and the discovery of gold in the Witwatersrand, saw the might of the British Empire ranged against determined Afrikaner farmers. Despite expectations of a quick victory, the Boers’ skilled use of modern rifle fire and guerrilla tactics led to a protracted, three-year war. Britain ultimately prevailed, but at a severe cost: over £200 million, the controversial use of concentration camps where tens of thousands died, and a lasting blow to British prestige that signalled the limits of its global hegemony.
Today, Iran is employing a modern form of asymmetric warfare, one honed since the Iran-Iraq War. According to analyses of its military doctrine, its strategy revolves around five key lines of effort: drone and missile attacks, proxy militia actions, global terrorism, cyber operations, and naval attacks to disrupt shipping. Crucially, Iran has developed a decentralised “Mosaic Defence” strategy, allowing regional units to act autonomously. This makes its military capacity resilient, difficult to neutralise with singular strikes, and echoes the stubborn, diffuse resistance the Boers mounted.
US and Israeli strikes have focused on degrading Iran’s drone and missile capabilities, central to its strategy. Yet, reports indicate Iran continues to launch attacks, demonstrating a sustained ability to strike back and inflict economic pain. As the economist Freya Beamish has noted, the assumption that Iran would quickly capitulate has proven false. The conflict has spilled over, with Iranian missiles hitting oil and gas facilities in neighbouring Gulf states.
The Economic Domino Effect
The ripple effects of the energy shock are following a grimly familiar pattern. The 1973 Yom Kippur War led to a quadrupling of oil prices and a global energy crisis. Today, the initial inflationary hit from pricier petrol, aviation fuel, and fertilisers is already being felt. Dearer transport costs will push up food prices, while businesses worldwide face a pincer movement of weaker consumer demand and soaring energy bills, leading to layoffs.
The disruption extends beyond oil. Qatar, a leading global exporter, is now unable to reliably ship helium—critical for semiconductors and electric vehicles—and sulphur, used in fertilisers and chemicals. These bottlenecks exacerbate existing vulnerabilities in global supply chains, recently exposed by the COVID-19 pandemic and the Suez Canal blockage. The case for greater economic self-sufficiency, particularly in renewable energy, is being reinforced daily.
Financial markets, which initially took comfort in President Donald Trump’s past record of policy reversals in the face of market turmoil—sometimes cynically abbreviated to Taco, for ‘Trump Always Chickens Out’—are now grappling with a prolonged standoff. As Beamish observes, “it takes two to Taco,” and Iran has shown no willingness to dance to Washington’s tune. The Trump administration’s “maximum pressure” campaign, which included withdrawing from the Iran nuclear deal, has culminated in a high-stakes military and economic confrontation with no clear exit.
A Hollow Victory in the Making?
President Trump now faces a dilemma reminiscent of Britain’s predicament in 1902. He could seek to end the conflict now, claiming achieved objectives but leaving the Tehran regime in place. Alternatively, he could prolong the campaign, increasing the risk of severe economic pain and political backlash at home. The former may be the less damaging option, but even a declared victory would be pyrrhic, exposing both US strength and its limitations.
The long-term geopolitical implications are significant. The war arrives at a time when US economic hegemony is under scrutiny. China is comfortably the world’s leading manufacturing power. Furthermore, the US dollar’s status as the world’s premier reserve currency is facing gradual erosion, its share in global reserves declining amid geopolitical shifts and concerns over US domestic vulnerabilities. While no alternative currency yet matches the depth and liquidity of the dollar, the uncertainty is palpable.
At the dawn of the 20th century, Britain’s victory in South Africa masked the dawn of a new era of protectionism, nationalism, and shifting power. Today, the conflict in the Middle East is delivering a similar, unwelcome lesson: in an interconnected world, military might cannot guarantee control, and the economic costs of conflict can swiftly eclipse its strategic gains, undermining the very power it was meant to affirm.
