No One Wins, So the War Ends
Why structural forces in the Iran conflict point toward convergence — the only unknown is timing.
Key Takeaways
Six players sit at this table. The payoff structure determines when the war ends, far more than missile inventories.
Core thesis: Iran fragmentation is every player’s worst outcome. When no one benefits from the same ending, structural forces suppress it. The unknown is timing and path, not direction.
Time is the hidden risk variable. Every day the conflict drags on, IRGC resources deplete irreversibly while Gulf states bleed economically. Kuwait has already been forced to cut production. If the convergence window closes, the probability of gradual fragmentation ticks up week by week.
Watch List: Omani Foreign Minister travel patterns, IRGC missile launch frequency changes, any “humanitarian corridor” arrangement in the Strait of Hormuz, Trump’s tone shifting from “surrender” to “deal,” Brent crude holding above $90.
Invalidation trigger: Any party deploys WMD, or a third nation enters with formal military force. Either event zeros out the entire scenario framework and demands full reassessment.
You See the Battle. I See the Board.
Everyone is watching who hit whom.
Which missiles landed where. How many intercepted. Whether ships can still transit the Strait today. The news ticker updates hourly. Analysts price oil forecasts to two decimal places.
The conflict’s end is determined elsewhere.
I want to look at this from a different angle. Set aside the military updates and the oil charts for a moment. Look at the game structure instead. Specifically, the payoff matrix of six players: what each party gains or loses under each possible ending.
My core thesis is simple. When you lay out the worst-case outcome for all six parties, they all point to the same place: Iran fragmentation. And when every player’s nightmare is the same event, that event almost never happens.
This does not mean the war ends tomorrow. But it means structural forces push toward convergence, not divergence.
Six Players at the Table
The surface narrative frames this as the U.S. and Israel versus Iran. The actual game has six parties, each running its own calculation.
The United States (Trump) wants a deal and a victory narrative. The negotiation playbook has been consistent since Day 1 of the conflict: stake out the most extreme position, let the counterparty panic, leave a back door open, wait for concessions under pressure, declare victory. “Unconditional surrender” in Trump’s operating language translates to “don’t try to outlast me.” On the same day he posted “UNCONDITIONAL SURRENDER,” he also said “Make Iran Great Again” and offered to help rebuild. The pattern is consistent with transactional language wrapped in maximalist rhetoric. What he does not want is a quagmire. A second Iraq would be a political disaster for his term.
Israel (Netanyahu) wants the permanent neutralization of Iran’s military threat. Missiles to zero, nuclear program to zero, proxy networks dismantled. But Netanyahu needs a neighbor without teeth, not a neighbor without a government. A fragmented Iran means weapons flowing to untraceable non-state actors. That is harder to defend against than a unified but weakened state.
Iran’s pragmatists (Larijani, the interim committee, Pezeshkian) want national survival. They can swallow humiliating terms as long as the state framework remains intact and they retain a seat inside it. Pezeshkian said on March 7 that “mediation should target those who underestimated the Iranian people and ignited this conflict.” That is a full register softer than the rest. He is opening a door.
The IRGC hardliners (31 semi-autonomous provincial units) want to keep fighting but face binding resource constraints. The key variable is not willpower. It is payroll. Estimated IRGC monthly operating costs run between $160 million and $290 million, with accessible foreign exchange reserves somewhere in the $5 billion to $15 billion range. A rough runway calculation puts that at two to six months. (These figures combine open-source intelligence and think tank estimates; precision is limited.) Missile stocks are depleting. Supply lines are severed. The mosaic defense structure makes each provincial commander an independent decision-maker but also collapses centralized coordination.
Gulf states (Oman, Qatar, Saudi Arabia, Turkey) want stability and restored trade. Kuwait was forced to cut production on March 6 after storage capacity hit its ceiling. Data provider Kpler has flagged that Saudi and UAE inventories are projected to reach full capacity within three weeks. Every additional day of Strait closure costs these economies real money.
External powers (China, Russia) want the upside without the risk. China needs Iranian oil, but the Trump visit to Beijing scheduled for March 31 is a higher priority. Russia benefits short-term from elevated oil prices but does not want to lose Iran as a long-term ally. Neither will take real risk for Tehran.
The Structural Rule: When Every Player Hates the Same Ending
The strongest predictive force in game theory comes from a simple observation: when every participant’s worst outcome is the same event, that event’s probability gets structurally compressed.
Iran fragmentation is that event.
Check each player.
The U.S. fears fragmentation. A failed state of 83 million people means a long-term security burden, WMD proliferation risk, and chronic oil price instability. Libya since 2011 is the standing lesson: toppling is easy, rebuilding is nearly impossible. Oil production there crashed from 1.6 million barrels per day to 300,000-400,000 and has never recovered. Trump needs a “win,” not a generation-long commitment.
Israel fears fragmentation. Multiple IRGC warlords controlling separate territories are less predictable than a single weakened government. Weapons proliferation to non-state actors spikes.
Gulf states fear fragmentation. Refugee waves, Shia unrest spreading to Bahrain, instability in Iran’s Khuzestan oil-producing region threatening global supply, and a decade of rebuilt regional diplomacy wiped out overnight.
Turkey fears fragmentation. Iranian collapse almost certainly triggers de facto Kurdish independence. That is Erdogan’s top strategic nightmare: 1,500 kilometers of border thrown into chaos.
Russia fears fragmentation. It loses its most important Middle Eastern ally and weapons customer. Short-term oil price gains versus long-term strategic losses net negative.
China fears fragmentation. A stable oil source disappears, Belt and Road investments in Iran go to zero, and Central Asian instability transmission risk rises.
No party derives net benefit from Iranian fragmentation. This is a rare “universally negative-sum” equilibrium. Game theory assigns one key property to such outcomes: every participant has incentive to prevent them, so their probability gets structurally suppressed.
Not to zero. But suppressed.
Fragmentation Is Leverage, Not the Objective
Since everyone fears fragmentation, it becomes the most powerful threat tool.
The pattern in Trump’s behavior is consistent with what game theorists call credible madness. “Unconditional surrender,” “no time limit,” “this is just the beginning.” These statements function to establish resolve, not to define the endgame. The goal is to make all parties believe he might actually push Iran into fragmentation, even if that outcome is suboptimal for the U.S. itself.
The power of this approach is that it does not just pressure Iran. It pressures everyone.
The effect on Iran’s pragmatists: “You see this? If we don’t negotiate, the state collapses.”
The effect on Gulf states: “You don’t want fragmentation? Then help me pressure Iran to the table.” Saudi Arabia, Qatar, and Oman are mediating more actively as a result.
The effect on China and Russia: “You don’t want to lose Iran? Then don’t get in my way.” China is unlikely to let Iran derail the March 31 summit.
If you read everything Trump said on March 6 together, “unconditional surrender” sits next to “elect a great and acceptable leader” and “we’ll help rebuild.” One reading of this is less an ultimatum and more a term sheet. The likely conditions: denuclearization, permanent IRGC military disbandment, end of proxy networks, leadership acceptable to Washington. The exchange: sanctions lifted, oil exports restored, international reconstruction support.
In the Axios interview, he said he “doesn’t care if it’s a democracy.” The implication directed at Iran’s establishment: you can remain an Islamic Republic, as long as you stop being a threat.
The Face Dilemma: Everyone Knows It’s Time to Talk, but Nobody Can Go First
This is the prisoner’s dilemma with face constraints layered on top.
Trump cannot say “conditional surrender is fine too.” That reads as weakness. The domestic political cost is too high.
Larijani cannot say “we’re ready to talk.” He risks assassination by IRGC remnants.
Pezeshkian cannot publicly accept mediation. That betrays national dignity.
Provincial IRGC commanders cannot say “we can’t fight anymore.” That makes them traitors.
Every “refusal” carries a hidden conditional clause.
Look at the public statements from March 7 side by side. Trump says “surrender.” Pezeshkian says “mediation should target the U.S. and Israel.” Surface-level, total opposition. But notice: Trump did not say “no mediation.” Pezeshkian did not say “no mediation.” Both are saying “let a third party handle it.”
The third party is Oman.
Both sides may be using public statements to accomplish the same thing: laying groundwork for eventual third-party mediation, while public posture stays maximally tough. Trump’s face: “I demanded surrender.” Pezeshkian’s face: “We defended our dignity.” What Oman may be saying behind closed doors: “Gentlemen, shall we discuss specifics?”
Why IRGC Provincial Commanders Don’t Play the Optimal Move
If the rational calculus is this clear, why don’t the 31 IRGC provincial commanders simply surrender?
Several structural factors. Identity lock-in and information asymmetry both matter: a lifetime inside the Revolutionary Guard means “surrender” does not exist in the cognitive framework, and end-node commanders may not know how bad the overall picture has become. Monitoring costs make it worse: even if you want to defect, you don’t know whether the commander next door is a loyalist; the first mover risks being purged. Martyrdom culture provides a psychological framework for continued resistance. And the collective action problem: no one wants to be first.
But every one of these barriers weakens over time.
Missiles are depleting. Supply lines are cut. Each day’s consumption is irreversible. The more critical variable is payroll. The IRGC is fundamentally a massive economic entity. It operates construction firms, banks, and trading companies. Faith provides the bonding agent, but salaries keep the machinery running. When paychecks stop, the bonding agent starts to dissolve.
The focal point that breaks the equilibrium? The first provincial commander who publicly defects. Once someone moves, the collective action problem shatters. The rest will calculate their own runway and decide to follow.
This is a question of “when,” not “if.” The economic constraint is irreversible.
The Invisible Third Table: Gulf Mediation
The visible game is deadlock. The back-channel game is likely far more active than headlines suggest.
Omani Foreign Minister Badr al-Busaidi said on March 3: “There are off-ramps available. Let’s use them.”
A mediator does not say “off-ramps exist” unless he knows what the specific off-ramps are. He is signaling that he has proposals in hand. No one is willing to accept them publicly yet.
One detail worth noting: among all Arab states hit by Iranian attacks, Oman was the only one deliberately spared. Even in the chaos of mosaic defense operations, Iran protected its sole mediation channel. The Omani port of Duqm saw minor drone spillover on March 1, but Oman’s response was to push diplomacy harder, not escalate. That restraint is itself a signal.
Oman is not alone. Reports indicate Tehran has asked Qatar, Saudi Arabia, and Oman to pressure Trump for a ceasefire. All three have called on Washington to halt Israeli operations and restore dialogue. Turkey’s Erdogan has called both Trump and Pezeshkian; Foreign Minister Fidan is reportedly working a diplomatic de-escalation track.
The 2025 Twelve-Day War provides useful pattern evidence: intense opening strikes, public maximalism from both sides, private mediation through Oman and Qatar, ceasefire at Day 12, all parties claiming victory. Public denial, private engagement running in parallel.
I cannot confirm whether active back-channel contact is underway right now. But structural forces all point toward a high probability that some form of contact exists: nobody wants fragmentation, Gulf states are applying pressure, the Omani channel is demonstrably open, and economic pressure is accelerating on all sides. If contact exists, it will not be called “negotiation.” It will be called “humanitarian coordination” or “third-party facilitation.” Face.
Time and Oil: The Hidden Player at the Table
Time is not neutral. It favors convergence.
Every additional day: IRGC missiles deplete further. Cash reserves shrink. Command coordination weakens.
Every additional day: Gulf economic losses compound. Kuwait began cutting production on March 6 after running out of storage. Kpler estimates Saudi and UAE inventories will hit capacity within three weeks. If the Strait blockade persists beyond two to three weeks, major Middle Eastern producers face physically forced production cuts.
Every additional day: U.S. military operational spending in the Middle East accumulates at a rate of hundreds of millions of dollars per day. That pace is not sustainable.
Brent crude has broken above $90, posting a 25% weekly gain, the largest since 2020. Oil above $90 accelerates everyone’s timeline. Consumer nations resist triple-digit prices. Producer nations resist demand destruction. Trump resists inflation re-entering the narrative.
One additional accelerant: Trump is scheduled to visit Beijing from March 31 to April 2 for a summit with Xi Jinping. The Iran situation is crowding the summit agenda. Washington has structural incentive to push the Middle East situation toward some controllable state before the summit, preventing Iran from becoming a variable in U.S.-China negotiations.
Time pushes toward convergence. The reason is straightforward: costs for every party increase monotonically with time, and no one can afford indefinite delay.
Prediction: The Shape of the Ending
There will be no surrender ceremony.
There will be no single moment called “the war is over.” What there will be is a gradual decline in attack frequency, incremental partial reopening of the Strait, and a day months later when people look back and realize the fighting had stopped. A formal agreement may come months after the de facto ceasefire. The entry point will likely be a “humanitarian corridor” or “medical supply passage,” a face-saving mechanism that lets every party claim it made no concessions.
⚠️ The scenario probabilities below are illustrative values for framework purposes. They should not be used as trading signals. Actual developments are subject to high uncertainty, and these values may shift materially with new information.
Scenario 1: Controlled Convergence (~55-60%)
Some form of contact produces progress within five to eight weeks, mediated by third parties, resulting in substantive violence de-escalation. No formal agreement is required. The threshold is attacks going to zero and the Strait gradually reopening. Key signals: Omani diplomatic activity, IRGC attack frequency, a shift in Trump’s tone. For allocators, this is a scenario of gradual risk premium release, though the unwind will not be smooth.
Scenario 2: Gradual Fragmentation (~25-30%)
The pragmatist faction fails to surface within the window. IRGC economic collapse triggers warlord defections and regional breakaway dynamics. Trump’s patience runs out and pivots to Plan B: regime change through popular uprising and information warfare. Key signals: IRGC payroll disruption, full-scale Kurdish offensive, Starlink activation over Iran. For allocators, this is a scenario where oil sustains above $90 and potentially reaches triple digits. Geopolitical risk premium does not fade.
Scenario 3: Black Swan (~15%)
WMD deployment, major extraterritorial terrorist attack, or formal military entry by a third nation. The rules of the game change entirely. For allocators, every assumption resets and full reassessment is required.
Fragmentation probability is structurally suppressed. But it is not zero. And every day the window stays open, it narrows slightly.
What This Means for Allocators: Direction Is Known, Timing Is Not
The game structure tells us direction: convergence. Every player’s worst outcome is the same event, so structural forces push toward some form of resolution.
The game structure does not tell us timing. Could be three weeks. Could be three months.
Direction known plus timing unknown. What does that combination mean for positioning?
Path A: Hold positions, absorb the volatility. You believe convergence will arrive and are willing to sit through the turbulence. The cost is psychological drag and potential interim drawdowns. This fits allocators whose exposure is already within tolerable bounds, who have stop-loss plans in place, and who measure in quarters, not weeks.
Path B: Reduce exposure, wait for clarity. You prefer not to be ground down by volatility in an uncertain timeframe. The cost is missing the rebound when risk premium releases faster than expected. This fits allocators running concentrated positions or facing short-term liquidity demands.
Path C: Use options structures to cap downside while preserving upside. The cost is ongoing theta decay, and protection is not cheap when implied volatility is already elevated. This fits allocators with derivatives capability who are willing to pay an explicit price for optionality.
Which path you choose matters less than knowing what you are giving up by choosing it.
⚠️ The structural forces pushing toward convergence are real. But they do not guarantee convergence within your time horizon, and they do not guarantee the path won’t get worse before it gets better. The distance between “the direction is right” and “I can survive the journey” is the most consistently underestimated variable in geopolitical event trading.
Closing
This war will end.
The reason is structural, not emotional. Every party is running the same math on its own calculator, and the answers all point the same direction: fragmentation costs too much, and resolution beats the alternative.
But “will end” and “ends tomorrow” have a gap between them. That gap is filled with face-saving politics and fear. Thirty-one provincial commanders sit on missiles that are already expiring.
Game structure guarantees the war will end. It does not guarantee peace will follow.
Disclaimer
This article reflects my personal investment philosophy. It is not investment advice. Make your own informed decisions.
Miyama Capital manages proprietary capital only and does not solicit external investors.
Kuan H. Wang Founder & CIO, Miyama Capital