Watch the full Global Energy Forum
Speakers
Helima Croft
Board Director, Atlantic Council; Managing Director and Global Head of Commodity Strategy and MENA Research, RBC Capital Markets
Brett McGurk
Distinguished Fellow, N7 Initiative, Rafik Hariri Center & Middle East programs, Atlantic Council
Moderator
William F. Wechsler
Senior Director, Rafik Hariri Center & Middle East programs, Atlantic Council
Event transcript
Uncorrected transcript: Check against delivery
WILLIAM F. WECHSLER: Thank you for—once again, for everyone being here, being part of this discussion. It’s quite important. And it comes at, of course, an absolutely critical moment for those of us who’ve spent our lives caring about the geopolitics and stability/security of the Middle East.
So we’re going to have a thirty-minute discussion here with two of the most well-positioned people to give us their views on what’s going on now and what we should expect.
From my own point of view, I just want to lead off by saying I see four real scenarios going forward: a great scenario, a good scenario, a bad scenario, and a terrible scenario. The great one is that the military objectives in the current campaign are met and the Iranian regime is not able to pose the kind of existential threat to the region that it—of the Iranian people taking matters into their own hands. A good scenario is that the Iranian regime comes back to the Trump administration and wants to do a deal on eliminating their enrichment of their nuclear program. A bad scenario is the military objectives are not met and Iran goes nuclear. And a terrible one is that the region is in war, which could involve the United States.
So the two people that I have here discuss are Brett McGurk, who has joined the Atlantic Council recently as a distinguished fellow working our Middle East Programs and our N7 Initiative, a joint partnership of the Atlantic Council and Jeffrey M. Talpins Foundation; and Helima Croft, the head of commodities at RBC Global and the head of the Middle East there as well.
We’re going to talk about security and energy issues here today. Let me start with you, Brett. Tell us what—you know, as we sit here the people in the Trump administration are gathering at some point today in the Situation Room to talk about what the options are for the United States to advance the good scenarios I talked about and minimize the risk of the lower scenarios. You’ve spent more time in that Situation Room than anybody I know talking about these issues. What would you be telling the president today?
BRETT MCGURK: Well—is this working? OK. Well, thank you, and congratulations, Atlantic Council, Landon, and everyone setting this up, and it’s great to hear from Dr. Sultan this morning. And, Fred, great to see you.
I caveat comments on what’s happening to say if anyone tells you they know exactly where this is heading or making kind of bold predictions they don’t know what they’re talking about. This is truly a completely unprecedented situation.
It flows out of the events of October 7th. I’m happy to kind of talk about the broader strategic context but you asked a specific question so let me get to it. If I was in the Situation Room right now I think, from the White House perspective, we have three immediate objectives.
Number one, obviously, we want to protect Americans and we want to help defend Israel. That is, like, first priority. So making sure we’re surging defense interceptors, everything. I’ve dealt with that an awful lot in the last year when I was in the White House. That’s number one.
Number two, try to contain this to Israel and Iran. Avoid a broader regional escalation. I think that’s actually a very achievable objective. So far I think that’s going fairly well—something we dealt with every day, every hour, from October 7th on.
I don’t know how many predictions of uncontrollable regional war there have been since October 7th. There has not been an uncontrollable regional war because of what the United States has done, frankly, consistently day by day, hour by hour, month by month.
Number three, I think you want to be working with the Israelis to ensure a focus on their declared objectives and avoid a mission creep scenario. Their declared objectives are dismantlement of the nuclear program and the missile program.
So those are kind of the three immediate objectives. But on the third one it’s very important because we know an awful lot about this. The Iran nuclear program has been a vexing challenge across administrations and the Rubicon here has been crossed, and I think we’ll mention that one of the worst outcomes would be this kind of ends with the main enrichment facility in Fordow intact.
And let me say a little bit about that because there’s a lot of focus about what is Israel doing, why. But Iran has made a series of fateful strategic miscalculations from October 7th on. It decided after October 7th to basically support a multifront war against Israel, and I lived through this and watched the whole thing.
They turned on Hezbollah to open a northern front. They turned on the Houthis to open a southern front. They supplied the militias in Iraq and Syria to open additional fronts. They directly attacked Israel twice in April and October. That is—October 7th miscalculations.
What happened? Hezbollah was basically knocked out. You have a new government in Lebanon. The Assad regime collapsed. You have a new government in Syria. We had a ceasefire in Gaza and hostages coming out. I’m hopeful we can still get back to a ceasefire there. You had the militias in Iraq declaring a ceasefire, relations in the Gulf very strong, and Iran in its weakest position since October 7th. So that’s kind of where things were left.
On the nuclear side, Iran continued to escalate its program. And just last week the IAEA came out with its comprehensive report that was asked for last year and found flagrant—what was their word?—egregious failure of Iran to live up to its nuclear commitments and focused a lot on Fordow.
In Fordow right now, buried into a mountain, there are ten cascades of very advanced IR-6 centrifuges. That cannot be left intact. And I think the way the White House sees this, and the policy right now as I read it, is the White House offered a deal to Iran about six weeks ago. I don’t know every detail. It’s described as a very fair deal. But that would basically give the world confidence that Iran is not and will not ever move towards a nuclear weapon.
And Iran not only did not really respond to that. It actually escalated its nuclear program in the face of this, including just last week saying they’re going to feed fuel into the cascades in Fordow and actually open a new underground enrichment facility. So Iran has just made these series of miscalculations. And I used to lead this channel in Oman with the Iranians and told them repeatedly, if you keep this up, it’s inevitable, inevitable, somebody will take care of this problem. And that’s kind of where we are.
So right now Iran has a choice. I mean, Abbas Araghchi, the foreign minister of Iran, can call Steve Witkoff, President Trump’s envoy, and say, you know, I kind of—I looked at the offer you put down six weeks ago. Actually, it’s pretty good. I think we’re going to take it. And I think this crisis would be over. Or they could not do that, looking at the possibility of a US strike on Fordow. I’m just saying that as an analyst.
But in any case, to Will’s four scenarios, this has to end without Iran’s nuclear-enrichment program intact. And hopefully that can end diplomatically. That option is still available. There’s still an off-ramp. Or the military campaign is now joined. The Israelis have a lot of options. And the US has a big option when it comes to Fordow.
WILLIAM F. WECHSLER: Thank you very much for that, Brett.
Helima, I want to talk—to turn to the energy markets. The energy markets have—don’t seem to have built in the risk that—of some of the scenarios that—of some of the scenarios that I and Brett were talking about. Can you help us understand why that is, what Iran could do that would change the markets’ views, and then how OPEC and others would react and the United States would react to that?
HELIMA CROFT: Great. Thank you so much. And Fred, thank you so much for convening us again. And Dr. Sultan, what an extraordinary open to the conference today.
As you mentioned, Will, I think the market is very sanguine about the risks entailed in any type of escalation in the Middle East at this moment. I think a lot of it goes back to the Russia-Ukraine war. There had been this expectation right away—remember what oil prices did right after the Russian invasion of Ukraine. We shot up. We were running to $130. Analysts were talking about potentially $200-a-barrel price of oil. There was an expectation that we could see three million barrels of Russian oil off the market.
And when that did not materialize, I think a lot of market participants were like, we have overplayed this risk. A number of prominent investors were burned betting on a Russian supply disruption. And they were like, I’m no longer going to price in risk of disruption. You can tell me about it, but I want to see it before I start pricing this in. And we have a situation right now in the market where we are well-supplied. You know, US production has been strong. Production out of countries like the United Arab Emirates, the investments that ADNOC has made in expanding spare capacity, means that we have ample supply on the market right now.
But the question is, Will, and we talked about this, if we were to see even a repeat of what we saw in 2019, if we saw attacks on tankers—remember, in 2019, after we reimposed maximum-pressure sanctions in May, we did have tankers hit off the coast of Fujairah. They were not sunk, but they were damaged. We had drone attacks on key pipelines over that summer, including the east-west pipeline. And then in September we had the attack on Abqaiq, the world’s largest oil-processing facility.
And to some extent because that did not yield sustained disruption—and, well, we talked about that. You know, was this a ceiling of Iran’s disruptive capabilities in 2019? Could they have done far more damage to Abqaiq if they had chosen to do so? But a lot of market participants were, like, we’ve seen the worst out of this. And if it did not yield a sustained disruption in 2019 when Abqaiq was hit, I really don’t need to be worried about it now unless it actually happens.
Now, people would say, the risk is potentially low. I’ve heard many experts say the risk of this spilling over into energy is low. But it’s not zero. And if you did have a situation—even last night—where’s my friend Amena Bakr? We were back and forth, you know, on our, you know, texts last night, because we had two tankers or three tankers on fire last night. And our immediate concern was, is this a repeat of 2019? Have those tankers been struck. Is Iran seeking to internationalize the cost of this conflict? Now it turns out there was a collision. It does not look like they were actually struck by a missile or a mine. But the concern was there right away.
So if we were to see some type of incident—we’ve already seen domestic energy infrastructure targeted. We’ve already seen South Pars struck. We’ve seen attacks on the important Haifa Refinery in Israel. We’ve had oil depots struck in Iran. All domestic. All kind of warning shots. But, again, I don’t think the market would be prepared for the export infrastructure being struck. And, again, that may never happen. And the Iranians may judge that the cost of doing so is too high. The Israelis may decide not in their interest to defund Iran by attacking Kharg Island, which would take off 90 percent of Iran’s oil exports.
But, again, the risk isn’t zero. And if you were to have something—even though we’re sitting at seventy-five dollars today—if you were to have just a repeat of anything we saw in 2019, we would move materially higher. Now, the question about OPEC, I don’t think OPEC is looking to add barrels to the market this time because of this situation. They are already unwinding a voluntary cut. We expect more rolling OPEC barrels on the market. But OPEC has made it pretty clear, they’re not going to fill a gap in the market until one emerges. So I would not expect, for example, a preemptive surge of a million-plus barrels, unless we see clear evidence of a supply disruption.
WILLIAM F. WECHSLER: Thank you very much. So the implications of that is, because the risk isn’t built into the markets today, if we do have this, the market impact would be much larger than it would be. And it would be a—would be a shock.
HELIMA CROFT: I think the market is taking it as a—I think energy markets—based on everything Brett said, like, you know, we’ve had this war in the Middle East that has not disrupted energy supplies to date. Again, the clearest one was what happened with Russia [and] Ukraine, where people were really thinking, are we going to do to Russia what we did to Iran in terms of secondary sanctions? I mean, we did a lot of work, though, to prevent a Russian disruption. Again, massive releases from the SPR, carveouts in terms of energy sanctions. We did price caps after the Europeans went forward with the sixth package of sanctions, which banned the import of seaborne oil into Europe and did a services ban. There was an active effort by the White House to ensure that the market would be well supplied. So—but I think the message or the takeaway, from many market participants is, call me when there is a disruption. You tell me there’s a lot of risk, but I’m waiting to see it materialize.
WILLIAM F. WECHSLER: Thank you very much for that.
Brett, I want to come back to you. You know, the issue, as you alluded to, Fordow, Fordow, Fordow. That’s the question. That is—that’s what’s going to be on the mind of President Trump. You served President Trump in his—in his first term. You’ve been in the Oval Office with him. He’s made absolutely clear over a long period of time that he doesn’t want a war with Iran. What’s different now? What would cause him, in your mind, to make that decision? And what are ways that events could unfold that would make it more likely?
BRETT MCGURK: I’d say, first, look, nobody wants—I think no president wants to order a military strike anywhere, frankly. I mean, I’ve been around four presidents. It’s, like, the most difficult decision. And anybody with the experience over the last twenty years, and if you spend time in Iraq like I did and others, like, you better go at such a decision with heady analysis, prudence, calculation, thinking through every unintended consequence.
The issue with Fordow—and I’m just going to—a lot of you know this. But it was a secret underground facility found by intelligence, announced to the world in 2009. The JCPOA had a lot of problems. It did say no enrichment at Fordow until 2030. After the JCPOA—US left the JCPOA, Iran started installing centrifuges in Fordow. And they eventually put in ten cascades of the IR-6s, which are the most advanced. And they started enriching to 60 percent uranium grade, which can spin up very fast to weapons grade. And you just read the IAEA report from last week.
This is a huge national security challenge. And I think the hope was that it could be dealt with through a deal. I mean, frankly, we in the—in the Biden administration had worked on this knowing that this year, 2025, is the year to deal with this problem, because there’s a deadline. The deadline, again, under the JCPOA, a provision its critics like is called snapback. Snapback means any member of that deal who’s still a member, basically France and the UK, can go to the UN Security Council and say, all international sanctions on Iran snapback. And they can do that until October of this year, when that expires under the JCPOA. So this is always the year to deal with this problem. And the hope, again, still, is that it can be dealt with diplomatically.
Now, the military option has had massive risk to it. Some of them—and being around this issue over the years I’m not revealing anything that’s not known—Hezbollah. Hezbollah had 150,000 to 200,000 missiles and rockets hanging over Israel. Any military strike into Iran, you risk Hezbollah unleashing those missiles on Israel. No longer a threat. Very significant. Hezbollah, even after the start of Israel’s military operation, has said: We want nothing to do with this. Second, air defense. Iran has pretty good air defense. Russian air defense systems, S-300s. There’s the risk of a pilot being taken down. That’s a big risk. That’s no longer there. Israel has complete air supremacy over Iran, which is an extraordinary thing. And that changes the entire calculation. Third, Iran has what it has. It has proxies. It has terrorism. It has missiles and rockets. And we know all that.
So the window of availability for a military option is now very open. And then how do you use that? Do you use that to try to get a deal, which I can actually see the administration doing? And if you say, if that—if that negotiation fails, then we have to be prepared to actually do the strike. And I think you do have to back it up. And around town if you say that, it’s, like, well, that means you’re going to lead. Look what happened in the Iraq War. This is not an Iraq War scenario. We invaded Iraq in 2003 with 130,000 troops, very small force, to overthrow a government and install an entirely new system.
I mean, that—talk about ends and means gap and unintended consequences? This is—and I’m not discounting the seriousness of this—but this is a military operation that has been planned, trained on, for, like, going back ten or fifteen years. And so it is available to the president. And the Pentagon’s job is to make it available and discuss it, if the president chooses to do it. And right now, it’s available as a backstop to diplomacy. And, again, anyone talking to Abbas Araghchi, he should call Steve Witkoff tomorrow, or right now, and say, you know what? I re-looked at the deal you put down. It’s pretty good. Let’s actually get together and do it. That’s the way out of this.
And being through the crisis since October 7th, I mean, this—sometimes it’s—I can get—frustrated is not the right word. But there are ways out of these problems. And right now, there could be a—we want a ceasefire in Gaza. Ceasefire in Gaza, if Hamas releases ten hostages, you have a sixty-day ceasefire in Gaza. Israel signed up to that. The US has signed up to it. It’s there. Iran right now—this crisis can end if Iran accepts the deal on the table. Or, I think, the military option becomes very viable.
And given where we are, the worst case here would be to leave Iran with that Fordow and ten cascades intact. So it’s a deal or it’s a military strike. I mean, I just—I think that is where we’re heading, and the events over the last twenty-four hours, I think, made that pretty clear. And that’s probably being discussed right down the street right now.
WILLIAM F. WECHSLER: You know, I’ve been briefed that we got about—that Iran at the current op tempo and the current projections of Israeli taking launchers off the battlefield that there’s about a—about a week, at least, more runway of these current level of operations continue. Of course, Iran also has by my count about three thousand short-range weapons that don’t threaten Israel but threaten our friends in the Gulf if things get—things get a lot worse.
My question to you, Helima, is in the scenario that Brett was just talking about, about the United States taking a strike on the—on the nuclear facility in Fordow, what’s that implication to the energy markets? And then what does the US do if the energy markets go a little haywire?
HELIMA CROFT: Well, I mean, certainly I think that, you know, US action against Fordow you would see, you know, a little pop in prices. But again, I think given the sort of bias of the market—I would say the recency bias of the market to say if it’s not an energy facility let’s take a pause, I think the real question would be in an endgame scenario for the Iranian government, again, A, what would come after—we talk about regime change, but who’s going to emerge to run that country? But the concern would be, I think, from the people who watch energy markets, who have spent time in the Middle East, who have been to places right after attacks have happened is, would you see proxy groups?
Like, would you see potentially risk to—we’ve talked about Straits of Hormuz, but I always think about, like, risks to Basra. I think about the risk to Iraq’s four-million-plus production because of Iranian-backed militias that operate very close to those facilities. So we would be watching, you know, what would happen in terms of, obviously, tankers. We would look to what would happen to—who are—where is the sort of soft security underbelly in terms of the energy system in the Middle East? And again, I would be concerned about risks to Iraq. I’d be concerned about risks to other countries’ energy facilities where they may not have taken the necessary steps to fortify those facilities.
So I don’t think the risk is—I do not think it is tail risk in a regime that feels its days are numbered, that they are not going to at least try to impose economic cost on the West and the rest of the world.
WILLIAM F. WECHSLER: Well, thank you very much.
In just the brief amount of time that we have left, let me—let me ask each of you to leave us with a thought that we haven’t talked about and, frankly, if it’s possible, that you think most people aren’t talking about enough. Like, what should we be thinking about that most people aren’t? Let me start with you, Brett.
BRETT MCGURK: Man. Right now I think what we’re all thinking about is what we should be thinking about, which is what is going to happen in the next week. And it is—you talk about a decisive historical period; we’ve living in it. We’re living in it.
And I—and I think the potential for a Middle East—I’m looking at a lot of friends here in the audience—the potential for this region is just enormous. It is enormous. I though the president’s trip was the right thing to do, very successful. What’s happening in UAE is extraordinary, Saudi Arabia, throughout the Gulf—everything that was just talked about in this panel.
And Iran has been a huge problem in this region for decades. And what has happened to Hezbollah and Iranian networks and Iran since October 7th sets conditions for a much more peaceful, integrated Middle East that we all want. And Iran is a spoiler to that; there’s just no question about it. So what’s going to happen here in the next week, I think, or so is potentially quite decisive.
And if we were here two years ago, and the question was hypothetically what if Israel launches a massive air attack on Iran, like, tomorrow—what would happen—I think Helima would have said it’s going to be all-out Middle East war, and energy markets, and everything else you can imagine. And actually, it’s happening right now. Israel controls the skies of Iran.
I mean, this is like—you know, and I just have to say I am proud of what the United States of America has done since October 7th, not without controversy. And these are hard calls, and they should be scrutinized. But I am proud of what we have done to reduce the risks of an all-out Middle East conflict, to significantly weaken Iran and all of these networks that threaten so many people, and to set the conditions for a far more peaceful, prosperous, integrated Middle East region.
With that said, there are going to be spoilers around and terrorist groups around and extremists around, many of them funded and supported by Iran. But an Iran without the sword of Damocles of a nuclear-threshold state is a much different problem. And here we are with potential to actually resolve that, at least for a significant period of time.
And I will just finish. I hope—I hope Iran finds a way to take a deal, the deal that the US has put on the table. And if not, I think there’s no other way.
So I have to answer that question, Will, by what should we be thinking about? It’s what’s happening right now. I don’t know what else—at least that’s what I’m thinking about.
HELIMA CROFT: I will be super fast.
To echo what you pointed out about the enormous progress that we’ve seen in the Middle East—I mean, it started by the UAE with the incredible economic transformation and diversification program. I mean, Dr. Sultan, I think your portfolio speaks to everything you do in that country, just even beyond energy. And you look at the other countries, Saudi Arabia. You think about what Kuwait is trying to do, taking enormous steps to diversify their economies, to future-proof their societies. And it’s predicated on a stable security environment.
And so I do think that we should be sanguine about what’s at stake if we do not find a solution that enables, you know, a stable, prosperous Middle East. And having a stable security environment is so important for the millions of young people in the region whose futures really rest on everything that these governments are trying to undertake.
WILLIAM F. WECHSLER: Thank you very much. I think you actually hit on what I was hoping you would hit on, which is not only the risks of the region but the potential of the region is what we also need to be thinking about deeply right now.
With that, I want to say thank you very much to our panelists here for a really fascinating discussion on the issues of the day. Thank you all for listening to us.
Watch the full event
Further reading
Mon, Jun 16, 2025
Twenty questions (and expert answers) on the Israel-Iran war
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The escalation between Israel and Iran has raised many important questions about a region already facing crises on multiple fronts.
Mon, Jun 16, 2025
How the US can reduce the risk of wider war in the Middle East
New Atlanticist By Caroline Zier
Five steps taken now can help put the White House in a better position to manage the spiral of escalation between Israel and Iran.
Fri, Jun 13, 2025
The strategic reserve and the Israel-Iran conflict
EnergySource By Joseph Webster, Landon Derentz
The US Strategic Petroleum Reserve is well-stocked and poised to help ease market pressures amid growing tensions stemming from Israel’s strikes on Iran. Rising domestic production, strong export capacity, and high net import cover collectively enable the United States to respond decisively while preserving energy stability at home.
Image: Helima Croft and Brett McGurk speak at the 2025 Global Energy Forum in a conversation moderated by Will Wechsler on June 17, 2025 in Washington, DC.