Case Study

Background

In January 2026, Iran experienced widespread mass protests challenging the clerical establishment led by Supreme Leader Ali Khamenei. These demonstrations represent the latest in a series of major uprisings against the regime, with protestors demanding freedom and political change.

Key Actors

Iranian Government

• Supreme Leader Ali Khamenei and the clerical establishment
• Security forces accused by human rights groups of killing and injuring protesters
• History of violent crackdowns during civil unrest

Protesters

• Mass demonstrations initially concentrated in opposition cities
• Movement spreading to regime strongholds, including Mashad (Khamenei’s hometown)
• Calling for fundamental freedoms and political change

United States (Trump Administration)

• President Trump warning of severe consequences for violent crackdowns
• Previous bombing of Iranian nuclear facilities (June 2025)
• Adopting cautious “wait-and-see” approach before deeper involvement

Opposition Leadership

• Reza Pahlavi (exiled crown prince) advocating for continued protests
• Seeking international support, particularly from Trump
• Using social media to mobilize demonstrators

Current Dynamics

Intelligence Assessment U.S. intelligence suggests protests are not yet widespread enough to directly challenge Khamenei’s leadership, though the geographic spread to regime strongholds represents a significant development.

Strategic Calculations Trump appears to be waiting to assess whether the protests can succeed in destabilizing the regime before committing to intervention, preferring quick outcomes over long-term Middle East engagement.

Competing Priorities The Iran crisis competes for U.S. attention alongside Venezuela’s political transition and discussions about Greenland, potentially diluting focus on the Iranian situation.

Outlook

Short-term (3-6 months)

Scenario 1: Regime Maintains Control (Most Likely)

• Security forces continue crackdowns with limited international response
• Protests gradually diminish due to repression and fatigue
• U.S. maintains rhetorical support without significant intervention
• Iran focuses on consolidating domestic control

Scenario 2: Escalating Unrest

• Protests spread further into regime strongholds
• Economic pressures intensify public discontent
• Military or Revolutionary Guard fractures emerge
• U.S. increases sanctions and rhetorical pressure

Scenario 3: External Intervention

• Major crackdown triggers U.S. military response
• Regional powers (Saudi Arabia, Israel) become more involved
• Risk of broader regional conflict escalation

Medium-term (6-18 months)

If Regime Prevails:

• Increased domestic repression and surveillance
• International isolation deepens
• Economic hardship accelerates
• Nuclear program tensions resurface

If Opposition Gains Momentum:

• Potential regime negotiations or partial reforms
• Political instability and power struggles
• Regional security implications intensify
• Oil market volatility

Long-term (2-5 years)

The trajectory depends heavily on whether protests catalyze fundamental change or the regime successfully suppresses dissent. A prolonged stalemate could lead to gradual erosion of regime legitimacy, while successful repression may entrench authoritarian control for another generation.

Solutions and Recommendations

For the International Community

Diplomatic Pressure

• Coordinate multilateral response through UN and regional bodies
• Implement targeted sanctions on officials responsible for violence
• Maintain unified messaging supporting peaceful protest rights

Support for Civil Society

• Provide secure communication tools for protesters
• Document human rights violations for future accountability
• Offer humanitarian assistance and refugee support

Economic Measures

• Balance sanctions to pressure regime without harming ordinary Iranians
• Create economic incentives for reform-minded officials
• Prepare contingency plans for various outcomes

For Regional Powers

De-escalation Priorities

• Avoid actions that could trigger broader military conflict
• Maintain diplomatic channels with all parties
• Coordinate responses to prevent regional instability spillover

Humanitarian Focus

• Prepare for potential refugee flows
• Support neighboring countries managing displacement
• Facilitate humanitarian corridor access

For Singapore and ASEAN

Diplomatic Positioning

• Maintain principled stance on peaceful protest rights
• Avoid taking sides in internal political struggle
• Emphasize sovereignty and non-interference principles while supporting human rights

Economic Preparedness

• Monitor oil market implications and energy security
• Assess supply chain vulnerabilities
• Diversify trade relationships to reduce exposure

Regional Coordination

• Work with ASEAN partners on unified response
• Engage constructively with all parties
• Support diplomatic resolution mechanisms

Impact on Singapore

Direct Economic Impacts

Energy Security

• Oil Price Volatility: Singapore imports 100% of its energy needs. Major Iranian unrest could disrupt global oil markets, raising prices for refined petroleum products
• Refining Sector: As a major refining hub, Singapore’s petroleum industry could face input cost increases and margin pressures
• Aviation and Shipping: Higher fuel costs would impact Singapore’s aviation and maritime sectors, potentially affecting Changi Airport and PSA operations

Trade and Investment

• Direct Trade: Singapore-Iran bilateral trade is modest (approximately $400-500 million annually), so direct trade disruption would be limited
• Indirect Effects: Supply chain disruptions affecting Singapore’s trading partners could have ripple effects
• Regional Investment Climate: Political instability may affect broader Middle East investment flows to Singapore

Indirect and Strategic Impacts

Regional Security Environment

• Broader Middle East instability could strain Singapore’s defense and diplomatic resources
• Potential for increased terrorism risks if extremist groups exploit chaos
• Singapore’s military cooperation with U.S. could face scrutiny in context of potential intervention

Financial Hub Status

• Safe-haven flows might benefit Singapore’s financial sector during regional uncertainty
• Sanctions compliance requirements could affect banking operations
• Wealth management inflows from Middle Eastern clients seeking stability

Geopolitical Positioning

• Singapore must balance relationships with U.S., Middle Eastern partners, and China
• ASEAN centrality principles favor diplomatic neutrality while supporting peaceful resolution
• Opportunity to demonstrate principled leadership on human rights and sovereignty

Sector-Specific Implications

Petrochemicals and Refining

• Jurong Island facilities may face input cost pressures
• Potential opportunity if other refineries face disruption
• Long-term planning should factor in Middle East supply uncertainty

Shipping and Logistics

• Strait of Hormuz disruptions could affect global shipping routes
• Insurance and freight rate increases possible
• Singapore’s position as transshipment hub could see shifts in cargo patterns

Aviation

• SIA and other carriers face fuel cost increases
• Potential route adjustments if airspace becomes contested
• Passenger demand from/to Middle East could decline

Technology and Cybersecurity

• Increased cyber threats as conflict actors seek leverage
• Opportunities for Singapore’s cybersecurity sector
• Critical infrastructure protection becomes more important

Policy Recommendations for Singapore

Energy Resilience

• Accelerate diversification of energy sources and suppliers
• Expand strategic petroleum reserves
• Fast-track renewable energy and LNG import capacity development

Economic Hedging

• Monitor exposure of Singapore companies to Iranian and broader Middle East risks
• Provide guidance on sanctions compliance
• Support affected sectors through temporary relief measures if needed

Diplomatic Engagement

• Maintain open channels with all parties
• Offer Singapore as neutral ground for dialogue if requested
• Coordinate ASEAN response emphasizing peaceful resolution

Scenario Planning

• Develop contingency plans for various escalation scenarios
• Conduct stress tests on critical infrastructure and supply chains
• Enhance civil defense and emergency preparedness

Regional Leadership

• Advocate for international law and peaceful conflict resolution
• Support humanitarian efforts through UN channels
• Strengthen Singapore’s reputation as responsible regional actor

Risk Assessment for Singapore

Low Risk

• Direct military conflict involving Singapore
• Severe disruption to Singapore-Iran bilateral relations
• Mass refugee flows to Southeast Asia

Medium Risk

• Sustained oil price increases affecting economic growth
• Regional security environment deterioration
• Cyber attacks on critical infrastructure
• Trade route disruptions through Middle Eastern waters

High Risk (if conflict escalates)

• Global economic slowdown affecting Singapore’s export-dependent economy
• Sharp energy cost increases squeezing consumers and businesses
• Financial market volatility impacting wealth management and trading

Opportunities for Singapore

Despite the challenges, certain opportunities may emerge:

• Diplomatic convening power: Singapore could offer neutral ground for negotiations
• Safe haven status: Enhanced attractiveness for Middle Eastern capital and talent
• Energy transition leadership: Crisis could accelerate regional clean energy adoption
• Supply chain resilience: Companies may diversify away from unstable regions toward Singapore

Conclusion

The Iran protests of 2026 represent a critical juncture with uncertain outcomes. For Singapore, the direct impacts are likely to be manageable given limited bilateral exposure, but indirect effects through energy markets, regional security, and global economic confidence could be more significant.

Singapore’s response should emphasize pragmatic preparedness while maintaining principled support for peaceful resolution and human rights. The city-state’s traditional approach of diplomatic balance, economic resilience, and strategic foresight will be essential in navigating this period of Middle Eastern uncertainty.

By strengthening energy security, diversifying economic relationships, and maintaining diplomatic flexibility, Singapore can mitigate risks while positioning itself as a stable anchor in an increasingly turbulent regional and global environment.