Shi’ites sympathetic to Iran sabotage Saudi Arabian eastern oil fields. Hundreds of alleged saboteurs are shot dead by Saudi security forces. An oil
tanker out of Kuwait is hit by a Silkworm and runs aground to keep from sinking. Another hits a mine. Insurers at Lloyd’s of London refuse to cover
any tankers transiting the Persian Gulf, claiming that damage incurred during a state of war is not covered by the policies. Oil shipments from the
region, one quarter of the world’s supply, stop completely, and oil goes up to $300 a barrel. Wall Street suffers its biggest loss in 20 years, with
the Dow Jones index plummeting more than 900 points.
The United States offers Iran a cease-fire, which Tehran rejects. Two days later, President Hamid Karzai of Afghanistan is assassinated by a Shi’ite
bodyguard under orders from Tehran. Pakistan declares that it is neutral in the conflict and orders the U.S. embassy to reduce its staff by 50%,
including the CIA station chief and his deputy. Order breaks down in both countries, and the Pakistani army declares a state of emergency, closing the
border with Afghanistan. NATO calls an emergency meeting and decides to begin the evacuation by air of the multinational force trapped in Afghanistan,
leaving many weapons and heavy equipment behind.
In the power vacuum, NATO troops withdraw to their bases while Taliban-backed militias take over much of Kabul and Kandahar. Afghanistan’s
Mazar-i-Sharif, which is largely Shi’ite, declares itself a part of Iran. The government resigns in Beirut, and Hezbollah forms a new one. A salvo
of Iranian Silkworm missiles sets the Saudi Arabian eastern oil fields ablaze. Saudi Arabia and the United Arab Emirates send an urgent diplomatic
message to Tehran declaring that they will be “neutral”in the fighting and will not assist the United States in any way. Kuwait sends the same
message, while Egyptian volunteers gather along the border with Israel in Sinai, demanding that Cairo take steps in support of their Arab brothers in
Lebanon. Kuwait refuses to allow the United States to use its men and supplies at Camp Doha against Iran. In Bahrain, rampaging Shi’ite crowds
depose Sheikh Khalifa al-Khalifa and set up an Islamic Republic, forcing the U.S. Fifth Fleet to abandon its only secure base in the region. The Dow
Jones index loses another 1,000 points.
The United States attempts to get China and Russia to mediate with Iran to end the fighting, but they refuse to do Washington any favors, noting that
they had opposed the attack in the first place and also citing their countrymen killed in the U.S. attacks. Suicide bombers attack in London,
Washington, New York, and Los Angeles. The attacks are poorly planned and inflict only a few casualties, but panic sets in and the public demands that
the respective governments do something. The United States tells the Iranian government that unless resistance ceases, nuclear weapons will be used on
select targets. India and Pakistan are alarmed by the U.S. threat and put their own nuclear forces on high alert, as does Israel. Russia and China
also increase their readiness levels to respond to the crisis.
Iran refuses to concede defeat, and the Iranian people rally around the government. The U.S. public is clamoring for action. Oil prices continue to
surge, and the long-term viability of petroleum supplies is in question as the Strait of Hormuz continues to be closed. Another U.S. ship is badly
damaged by suicide attackers in the Persian Gulf. American embassies throughout the region are attacked. Anti-American rioting takes place in Jakarta,
Kuala Lumpur, Mindanao, and in Dhaka. The United States consulate general in Karachi, Pakistan, is sacked and burned. Forty Americans die along with
scores of Pakistanis when the Marine guards open fire.
There are frequent terrorism scares in a number of American cities, which are under red-alert security lockdown, though there are no new attacks.
Domestic air travel declines by more than 50%. As a preventive measure, there are mass arrests of American Muslim leaders. Some antiwar activists are
detained at military prisons, including Guantanamo, under the provisions of the Military Commissions Act and the National Defense Authorization Act of
2012. Israel continues to be bombarded from inside Lebanon. Its air attacks inflict massive damage on civilians but are unsuccessful in stopping the
rockets. Its government falls and is replaced by a hard-right regime headed by former Foreign Secretary Avigdor Lieberman. Rioting rocks the West Bank
and Gaza, forcing Palestinian President Mahmoud Abbas to resign and flee to Paris. Hamas forms a provisional government. India threatens to attack
Pakistan if there is any question about the security of Islamabad’s nuclear arsenal.
The United States uses a neutron-type bomb against the main Iranian nuclear research center at Natanz, which both Washington and Israel had already
bombed conventionally and destroyed. It vows to bomb again if Iran continues to resist. Iran is defiant and fires another wave of Silkworms at U.S.
ships, hitting one. Russia and China place their nuclear forces on high alert. Pakistani militants assume control of the government, aided by radical
elements in the army and the intelligence service. India launches a preemptive strike against the main Pakistani nuclear centers at Wah and Multan,
where the country’s arsenal is believed to be concentrated. Pakistan has some of its nukes moving around on trucks to avoid such a scenario,
however, and is able to strike back by bombing New Delhi.
A minor engagement between American and Iranian forces in the Persian Gulf has ignited World War III.

