Market Updates

Israel-Iran War: Situation Report – June 23, 2025

Executive Summary

As of June 23, 2025, the conflict between Israel and Iran, which escalated into open warfare on June 12, 2025, has entered its second week. Israel initiated the conflict with airstrikes targeting Iran’s nuclear facilities, military infrastructure, and leadership, aiming to dismantle Iran’s nuclear program and degrade its military capabilities. Iran has retaliated with missile and drone attacks on Israeli cities and military sites. On June 21–22, 2025, the United States directly entered the conflict, conducting airstrikes on three Iranian nuclear facilities—Fordow, Natanz, and Isfahan—marking a significant escalation. This report provides a detailed overview of the conflict’s current status, key events over the weekend, U.S. involvement, and international reactions, drawing on credible sources to ensure accuracy and comprehensiveness.

Background

The Israel-Iran conflict has roots in decades-long tensions, primarily over Iran’s nuclear ambitions, support for proxy militias, and Israel’s security concerns. The current war began on June 12, 2025, when Israel launched a surprise attack targeting Iranian nuclear sites, military bases, and key figures, including nuclear scientists and military commanders (Institute for the Study of War [ISW], 2025a). Israel’s stated objective is to prevent Iran from developing a nuclear weapon, with Prime Minister Benjamin Netanyahu emphasizing the elimination of Iran’s nuclear and ballistic missile capabilities (Al Jazeera, 2025a). Iran has responded with over 450 missile and 1,000 drone attacks on Israel, causing significant damage and casualties (CBS News, 2025).

The conflict has disrupted regional stability, with Iran’s allies, including Yemen’s Houthis, Hezbollah, and Hamas, condemning Israeli and U.S. actions and threatening retaliation (ISW, 2025b). Diplomatic efforts, including European-led talks in Geneva and U.N. Security Council meetings, have failed to secure a ceasefire, and the risk of a broader regional war remains high (Reuters, 2025a).

Current Status of the Conflict

Military Engagements

  • Israeli Operations: Israel has conducted daily airstrikes since June 12, targeting Iran’s nuclear facilities (e.g., Natanz, Isfahan, and possibly Fordow), missile production sites, and air defense systems. On June 21, Israel struck centrifuge production sites in Isfahan and Qom, killing at least two civilians (CBS News, 2025; The New York Times, 2025a). The Israel Defense Forces (IDF) claim to have destroyed over 60% of Iran’s missile launchers and 70 air defense batteries, significantly degrading Iran’s ability to retaliate (ISW, 2025a; The Times of Israel, 2025). Israel has also targeted Iranian leadership, killing senior Quds Force official Mohammed Said Izadi and others (The New York Times, 2025a).
  • Iranian Retaliation: Iran has launched multiple waves of ballistic missile and drone attacks on Israel, with strikes reported in Tel Aviv, Haifa, and Beersheba. On June 21, Iran fired approximately 20 missiles, damaging buildings in Haifa and an Ottoman-era mosque (Reuters, 2025a). Iranian state media reported 657 deaths, including 263 civilians, and over 2,000 injuries from Israeli strikes, while Israel reported 24 deaths from Iranian attacks (CBS News, 2025; NBC News, 2025a).
  • Nuclear Program Impact: The International Atomic Energy Agency (IAEA) confirmed damage to Iran’s Natanz facility, with thousands of centrifuges likely destroyed or damaged. Satellite imagery shows structural damage at Natanz and Arak, with concerns about radiological contamination (NBC News, 2025b). Israel claims to have “interesting intelligence” on Iran’s 60% enriched uranium stockpile, suggesting ongoing efforts to locate and neutralize it (The Times of Israel, 2025).

Humanitarian and Economic Impact

  • Iran: Panic and displacement have gripped Tehran, with residents fleeing the capital amid Israeli evacuation warnings. Long lines at gas stations and limited access to banking services have disrupted daily life (NPR, 2025a). Iranian connectivity is intermittent, with cyberattacks attributed to pro-Israel groups like Predatory Sparrow targeting banks (NBC News, 2025c).
  • Regional and Global: Brent Crude oil prices rose 7% due to strikes on Iranian energy infrastructure, raising fears of a global energy crisis if Iran closes the Strait of Hormuz (Brookings Institution, 2025). Bitcoin and other digital assets also fell amid geopolitical tensions (NBC News, 2025a).
  • Israel: Air-raid sirens and missile strikes have disrupted life in major cities. Ben Gurion Airport has limited operations, with only 50 passengers allowed on outgoing flights dueto security concerns (The Times of Israel, 2025). The Health Ministry has implemented early hospital discharges to manage capacity (The Times of Israel, 2025).

U.S. Actions Over the Weekend (June 21–22, 2025)

On June 21, 2025, President Donald Trump announced that U.S. forces had conducted airstrikes
on three Iranian nuclear facilities—Fordow, Natanz, and Isfahan—under “Operation Midnight
Hammer.” The strikes, executed by B-2 stealth bombers equipped with Massive Ordnance
Penetrators, aimed to “obliterate” Iran’s nuclear enrichment capacity (AP News, 2025; CNN,
2025a). Key details include:

  • Strike Details: The Pentagon described the operation as an “incredible and overwhelming success,” involving decoys and deception with no Iranian resistance. The strikes targeted underground infrastructure, though the extent of damage to Fordow’s deeply buried facility remains uncertain (AP News, 2025; The Washington Post, 2025).
  • Trump’s Statements: Trump claimed the U.S. now has “complete and total control of the skies over Iran” and warned of “overwhelming retaliation” if Iran responds. He also raised the possibility of regime change, calling Supreme Leader Ayatollah Ali Khamenei “an easy target” (NBC News, 2025a; The Washington Post, 2025).
  • Casualties and Damage: Iran evacuated personnel from the targeted sites, minimizing casualties, but acknowledged damage to facilities. Several U.S. citizens were lightly wounded by Iranian missile debris (CBS News, 2025; CNN, 2025a).
  • Military Posture: The U.S. deployed the USS Nimitz aircraft carrier to the Middle East and placed over 40,000 troops on high alert at bases in Qatar, UAE, and Saudi Arabia. Satellite imagery shows U.S. warplanes removed from Al-Udeid air base in Qatar, possibly to avoid Iranian retaliation (NBC News, 2025b; The New York Times, 2025b).

International Reactions

  • Allies and Partners:
    • U.K.: Prime Minister Keir Starmer supported the U.S. strikes, citing Iran’s nuclear threat (Al Jazeera, 2025a).
    • Australia and New Zealand: Both called for de-escalation but acknowledged the strikes as a response to Iran’s nuclear program (Al Jazeera, 2025b).
    • Gulf States: Qatar, Oman, and UAE expressed concern over escalation, with Bahrain implementing work-from-home measures for government employees (Al Jazeera, 2025a).
  • Adversaries:
    • Iran: Foreign Minister Abbas Araghchi condemned the U.S. strikes as a “dangerous military operation” and reserved “all options” for retaliation. Iran rejected zero uranium enrichment demands but expressed willingness to return to 3.67% enrichment under the 2015 JCPOA (ISW, 2025b; Reuters, 2025a).
    • Russia and China: Both condemned the U.S. strikes, with Russia issuing veiled threats and China calling for U.N. intervention (Al Jazeera, 2025a; ISW, 2025c).
    • North Korea: Denounced the U.S. attack as a violation of sovereignty (NBC News, 2025a).
  • International Organizations:
    • U.N.: Secretary-General Antonio Guterres warned of a “deadly downward spiral” and urged a return to diplomacy (Al Jazeera, 2025a; The Times of Israel, 2025).
    • IAEA: Director General Rafael Grossi warned of radiological risks from strikes on Natanz and Bushehr, denying that IAEA findings justified military action (CNN, 2025b; NBC News, 2025b).
  • U.S. Domestic: Senate Minority Leader Chuck Schumer and House Democratic Leader Hakeem Jeffries criticized Trump for bypassing congressional authorization, invoking the War Powers Act. Republican leaders largely supported Trump, though some “America First” supporters expressed dissent (CNN, 2025a; The Washington Post, 2025).

Risks and Future Outlook

  • Escalation Risks: Former CIA Director Leon Panetta warned that U.S. strikes could plunge the region into a broader war, with Iran likely to retaliate against U.S. bases or close the Strait of Hormuz (CNN, 2025a). Iranian-backed militias, including Kataib Hezbollah and the Houthis, have threatened attacks on U.S. forces and shipping (ISW, 2025b; ISW, 2025c).
  • Nuclear Program: Experts are skeptical that even U.S. strikes can fully dismantle Iran’s nuclear program, particularly Fordow’s underground facilities. Some argue the attacks may push Iran to accelerate weaponization (The Guardian, 2025; The New York Times, 2025b).
  • Diplomacy: Iran’s refusal to negotiate under attack and the collapse of U.S.-Iran talks in Oman dim prospects for a diplomatic resolution. European efforts in Geneva have stalled, with Iran insisting on Israel halting strikes as a precondition (Reuters, 2025a; CNN, 2025c).
  • Israeli Sustainability: Israel faces challenges sustaining its campaign due to missile interceptor shortages, crew fatigue, and aircraft maintenance needs. Without U.S. support, Israel’s ability to maintain high-intensity operations may wane (The Guardian, 2025).

Conclusion

The Israel-Iran war, now in its second week, has reached a critical juncture with the U.S.’s direct involvement through strikes on Iranian nuclear sites. While Israel and the U.S. have degraded significant portions of Iran’s nuclear and military capabilities, Iran’s retaliatory strikes and threats from its proxies signal a high risk of further escalation. International condemnation and domestic U.S. criticism highlight the contentious nature of the conflict. Without a viable diplomatic path, the region faces the prospect of a prolonged and destabilizing war with global economic and security implications.

References:

  • Al Jazeera. (2025a, June 22). Israel-Iran conflict: List of key events, June 22, 2025. https://www.aljazeera.com/news/2025/6/22/israel-iran-conflict-list-of-key-events-june-22-2025
  • Al Jazeera. (2025b, June 22). World reacts to US attacks on Iran. https://www.aljazeera.com/news/2025/6/22/world-reacts-to-us-attacks-on-iran
  • AP News. (2025, June 22). Alarm grows after the US inserts itself into Israel’s war against Iran with strikes on nuclear sites. https://apnews.com
  • Brookings Institution. (2025, June 16). Israel strikes Iran. What happens next? https://www.brookings.edu
  • CBS News. (2025, June 21). Israel-Iran war enters second week with more strikes as warning against U.S. intervention issued. https://www.cbsnews.com
  • CNN. (2025a, June 22). June 21, 2025 – Israel-Iran conflict. https://www.cnn.com
  • CNN. (2025b, June 19). June 19, 2025 – Israel-Iran conflict. https://www.cnn.com
  • CNN. (2025c, June 20). June 20, 2025 – Israel-Iran conflict. https://www.cnn.com
  • Institute for the Study of War (ISW). (2025a, June 15). Iran Update Special Report, June 15, 2025, Morning Edition. https://www.understandingwar.org
  • Institute for the Study of War (ISW). (2025b, June 21). Iran Update Special Report, June 21, 2025, Evening Edition. https://www.understandingwar.org
  • Institute for the Study of War (ISW). (2025c, June 22). Iran Update Special Report, June 22, 2025, Evening Edition. https://www.understandingwar.org
  • NBC News. (2025a, June 22). Iran vows retaliation after U.S. strikes on nuclear sites; Trump claims success. https://www.nbcnews.com
  • NBC News. (2025b, June 20). Israel-Iran conflict: Fresh attacks as Trump sets two-week deadline for U.S. action. https://www.nbcnews.com
  • NBC News. (2025c, June 17). Trump says ‘we now have complete and total control of the skies over Iran’. https://www.nbcnews.com
  • NPR. (2025a, June 17). 4 things to know as the war between Israel and Iran intensifies. https://www.npr.org
  • NPR. (2025b, June 15). Israel and Iran trade more deadly strikes in third day of escalating conflict. https://www.npr.org
  • Reuters. (2025a, June 20). Iran says no to nuclear talks during conflict as UN urges restraint. https://www.reuters.com
  • The Guardian. (2025, June 21). Outcome of Israel’s war with Iran is uncertain even if US joins conflict. https://www.theguardian.com
  • The New York Times. (2025a, June 20). Israel and Iran trade new strikes on 9th day of war. https://www.nytimes.com
  • The New York Times. (2025b, June 17). Iran is preparing missiles for possible retaliatory strikes on U.S. bases, officials say. https://www.nytimes.com
  • The Times of Israel. (2025, June 21). June 22: Netanyahu: Israel has ‘interesting intel’ on whereabouts of Iran’s 60% enriched uranium. https://www.timesofisrael.com
  • The Washington Post. (2025, June 22). Officials assess damage from U.S. strikes; Trump raises possibility of regime change in Iran. https://www.washingtonpost.com
  • Wikipedia. (2025, June 22). 2024 Iran–Israel conflict. https://en.wikipedia.org

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