Iran's psychological strategy, which keeps "Israel" uncertain about when the sword of Damocles will fall, is both agonizing and damaging. By keeping its options secret, Iran has already inflicted considerable harm on the Zionist entity without any military intervention.

Just 13 days after the martyrdom of Hamas chief, Ismail Haniyeh, in Tehran, Israeli media started contesting over the reasons behind Haniyeh's assassination, which placed "Israel" in a hazardous position with all governmental activities coming to a standstill and the economy going down the hill.

Israeli media start crying

In a piece in The Jerusalem Post on August 9, the analyst, Yaakov Katz, posed a pertinent question of whether "Israel" achieved the objectives behind Haniyeh's killing, and whether is it worth the pain and anguish "Israel" is going through, "anxiously bracing for an Iranian and Hezbollah retaliation that looms like a shadow over the nation?"

Katz, who is a former editor-in-chief of the newspaper, believes that certain elements within the Israeli government may favor this ongoing state. They have little regard for "Israel's" global perception or future relations with the United States. Regardless, some ministers openly wish for Donald Trump's victory in the election.

In his article titled "Jewish extremism threatening Israel" published in The Jerusalem Post on August 9, Rabbi Kenneth Brander expresses concern about the current situation. He ponders the uncertainty of when and to what extent an attack may occur. Will we experience further devastating losses and long-lasting emotional distress? In another article titled "Superpower Fatigue", published on August 9, Ruth Wasserman Lande raises concerns about how many countries are closely observing us with an extremely critical perspective.

The Institute for the Study of War (ISW), a US-based think tank that specializes in war strategy, has recently published its most recent report on Iran. The report asserts that Iran seeks to incite dread and anxiety among Israelis by delaying its response and exploiting rumors regarding its timing and nature.

The think tank went on to say that the August 11 issue of Defa Press, a publication run by the Iranian armed forces, stated that Iran was waging a "flawless psychological war" against "Israel" by prolonging its counterattack. Iran's psychological warfare against "Israel", according to Defa Press, has upset Israelis' daily schedules and caused the Israeli economy to stagnate. Furthermore, the outlet views that since the war on Gaza began in October 2023, a large number of Israelis have attempted to leave the country.

This assertion, the ISW believes, aligns with its prior analysis, which suggests that part of Iranian officials' strategy to dismantle "Israel" involves inciting unrest and fear within the entity to promote a movement away from it. The ISW further disclosed that on August 10, a member of the Iranian Parliament's National Security and Foreign Policy Committee stated separately that "the retribution operation includes putting Israel in limbo."

'Israel's' economy hits rock bottom

The US credit rating agency Fitch reduced "Israel's" rating on Monday, August 12, from "A+" to "A", predicting a 7.8% budget deficit and debt exceeding 70% of GDP in the medium run for the current fiscal year.

According to Fitch, "The downgrading to 'A' reflects the impact of heightened geopolitical threats, military actions on numerous fronts, and the ongoing conflict in Gaza." Fitch also noted that the possibility of reprisals from Hamas and Iran played a role in the downgrade.

Furthermore, "Israel's" credit profile will certainly suffer because of the probable decline in World Bank Governance Indicators, warning that the ongoing violence in Gaza would affect the economy "far into 2025." According to Fitch, there is a chance that the war may spread to other fronts and that tensions in Gaza will persist until 2025.

"Aside from the death toll, it might bring a large increase in military spending, infrastructural damage, and longer-term harm to investment and economic activity, which would further worsen Israel's credit metrics,” it commented.

The likely Iran's retaliation has prompted the indefinite cancellation of flights to and from "Israel". They anticipate that a larger war in the northern region would exacerbate the already negative effects of the Gaza war on the economy. Within the Finance Ministry, there is significant anxiety, since authorities anticipate that in the event of a major war, "Israel" will experience unprecedented damage to its infrastructure, enterprises, imports, exports, and other sectors.

Iran has many arrows in its quiver

Iran has many options to exercise if it decides to go ahead with its planned retaliation. Instead of being in a vulnerable position, the Iranian leadership is exercising restraint to prevent the escalation of a major regional war and avoid accountability for jeopardizing regional tranquility. However, as a US think tank has assessed, Iran seeks to weigh the pros and cons of such action, aiming to not only restore deterrence with "Israel" but also avoid an all-out war that could jeopardize the peace in West Asia.

Nevertheless, Iran has the potential to escalate the situation by resorting to military action, as it demonstrated on April 13 in retaliation for the attack on the Iranian Embassy in Damascus that resulted in the loss of seven members of the Islamic Revolutionary Guards Corps (IRGC). Iran avoided hitting civilian targets and restricted its barrage to hitting only military installations.

Equally important, the Iranian barrage on "Israel" lacked any element of surprise, primarily because everyone knew when Iran intended to attack. Iran deliberately announced its intention in advance. This time around, the situation is completely different, and it appears that Iran is keeping its intentions close to its vest when it comes to confronting "Israel".

Military comparison   

Iran has a significantly larger number of active personnel in its military force compared to "Israel". With a 610,000-strong army, Iran's military strength exceeds that of "Israel", which has 170,000 active forces. Iran has significantly more available force than "Israel". Iran has forty-nine million people available for service, compared to "Israel's" 3.80 million.

In terms of fit-for-service individuals, Iran has 41.17 million people, whereas "Israel" has 3.16 million. The distribution of power concerning the number of individuals available for service is a critical factor in determining the outcome of the war. "Israel" boasts about a significantly larger reserve force, totaling 465,000 personnel, in comparison to Iran's 350,000.

Iran's naval force is formidable, with a fleet of 101 vessels, including nineteen submarines, while "Israel" has sixty-seven vessels and five submarines. The importance of controlling the seas is essential to secure strategic positions and conduct naval operations.

In terms of airpower, "Israel" has a slight advantage over Iran, with a total of 612 aircraft with more fighter aircraft and attack helicopters compared to Iran's 551 aircraft.

Although Iran's defense budget is comparatively on the lower side at $9.95 billion against "Israel's" $24.4 billion, it, however, maintains a stronger financial position with lower external debt at $8 billion against "Israel's" $135 billion. Furthermore, Iran is a key player in the oil industry, pumping out a daily production of 3.45 million barrels. In contrast, "Israel" does not have any oil production to speak of.

Although Iran's foreign reserves are lower at $127.15 billion than "Israel's" $212.93 billion, the abundance of oil wealth provides Iran with the ability to sustain a prolonged war. A solid financial foundation is thought crucial for extended military campaigns.