The Impact of the 12-Day War on the Economy of the Israeli Regime

2025/07/31 | Economy, interview, Top News

Strategic Council Online – Interview: A senior international affairs analyst stated that the Israeli regime’s 12-day war against Iran in June 2025 has pushed its economy to a fragile point. A 16.2% decline in exports to $3.6 billion is just the tip of the iceberg of the crisis. Simultaneously, global isolation and the continued widening of crimes in Gaza have placed an additional burden on its economy. The weakening of the shekel against the dollar and the destruction of key infrastructure have plunged the Israeli regime’s economy into a whirlpool of a 20.6% trade deficit and a 3.4% drop in six-month exports to $26.97 billion. A 5% increase in imports has further exacerbated the pressure. This crisis, rooted in the Israeli regime’s military adventurism and global isolation, has driven it toward dependence on foreign aid and social collapse.

Economic Losses and Paralyzed Infrastructure

Hassan Hanizadeh, in an interview with the website of the Strategic Council on Foreign Relations, stated that the Zionist regime has suffered over $110 billion in economic losses since October 2023. These losses peaked during the 12-day war, with estimates indicating $30 billion in damages during this period alone. Iran’s attacks have severely paralyzed critical infrastructure, including rail and air transport systems. Ben Gurion Airport, the main gateway to and from the occupied territories, has been shut down, and international flights have been suspended.

The international affairs analyst noted that the rail transport system in the occupied territories will remain unusable for at least two weeks to two months due to extensive destruction. Additionally, around 1,800 multi-story buildings have suffered partial or total damage, reflecting the scale of the disaster caused by the Islamic Republic of Iran’s missile response. He emphasized, “This level of destruction has placed the Zionist regime in the face of an economic crisis that is impossible to recover from without foreign aid. These losses, coupled with the halt in industrial and economic activities, have pushed the Israeli regime’s economy to the brink of a commercial abyss.”

Destruction of Commercial Centers and Energy Crisis

The international affairs expert stated, “Iran’s attacks have targeted not only transport infrastructure but also the commercial and energy centers of the Zionist regime.” Hanizadeh pointed to the destruction and closure of the Haifa port due to Iran’s attacks, as well as the earlier lockdown of the Eilat port due to Yemen’s Ansarullah attacks, effectively removing both ports from the Israeli regime’s global trade cycle.

He added, “In addition to the destruction of the Haifa and Eilat ports, the Haifa oil refinery—one of the most important fuel production centers for the Zionist regime—has been seriously damaged, leading to gasoline rationing in the occupied territories. The severe reduction in vehicular traffic due to fuel shortages has disrupted transportation-dependent economic activities.”

Hanizadeh stated, “The destruction of the Haifa refinery has halted fuel production and paralyzed the Israeli regime’s economy, which is heavily dependent on energy.” The expert stressed, “The 16.2% decline in exports in June 2025, along with international sanctions and the devaluation of the shekel against the dollar, has placed additional pressure on the regime’s economy. This situation reflects the gradual collapse of the Israeli regime’s trade capacity, which is now heavily reliant on foreign aid.”

Reverse Migration Wave and Social Crisis

One of the key points raised by Hassan Hanizadeh is the phenomenon of reverse migration among residents of the occupied territories due to the economic and energy crisis following the war with Iran. He explained, “After the ceasefire, many dual-nationality residents have migrated at great cost by sea to destinations such as Greece, Cyprus, and later Europe and even the U.S. This migration wave, which the Zionist regime has tried to conceal through extensive media censorship, has become a fundamental challenge.”

The international affairs analyst emphasized, “The exodus of residents, especially elites and dual citizens, is the biggest threat to the survival of the Zionist regime. This migration has not only reduced the workforce but also severely undermined public confidence in the regime’s ability to provide security and economic stability.” He added, “Although media censorship during the 12-day war attempted to hide the scale of this social and economic crisis, the facts on the ground can no longer be denied.” According to Hanizadeh, this situation has placed Israel at risk of social collapse.

Political Fragility and Netanyahu’s Uncertain Future

Hassan Hanizadeh also addressed the highly fragile political state of the Zionist regime and Benjamin Netanyahu’s role in exacerbating the crisis. Citing statements by Ehud Barak, a former prime minister of the Israeli regime, he called Netanyahu the “greatest enemy” of the regime, whose adventurism in Gaza, Iran, Syria, and Yemen has incurred heavy military, economic, and social costs.

He further pointed to the possibility of early elections and the collapse of Bibi’s government, stating, “The withdrawal of two religious parties from Netanyahu’s coalition cabinet is a sign of deep divisions within the Israeli regime’s political structure.”

Hanizadeh predicted, “If the withdrawal of other parties continues, Netanyahu’s cabinet will collapse, and the Likud party will suffer a major defeat in any future elections.” He also referenced efforts by the U.S. and Donald Trump’s team to sideline Netanyahu gradually, stating, “The U.S. has paid a heavy price for supporting Netanyahu’s adventurism and may now seek a change in the Israeli regime’s leadership. This trajectory paints an image where political crises are intertwined with economic and social challenges.”

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