If the United States (US) and Iran now sign the draft peace deal that has been agreed in principle, the original analysis from The Common Sense of the Iran war will have been proven strikingly accurate.

That analysis made three central arguments.

The first was that the war was more likely to end in the nearer term than the longer term. The second was that oil prices would remain broadly within their long-term inflation-adjusted range rather than breaking into a new and sustained crisis zone. The third was that, as a result, the global economy and financial markets would hold up far better than the worst-case forecasts of a regional war, oil shock, and global economic crash implied.

All three arguments now look to have held.

At odds with most mainstream analysis, the original analysis of this newspaper was that the war would probably not move into a wider regional war, a prolonged ground phase, sustained higher oil prices, rising interest rates, and sharp market losses. Instead, The Common Sense argued that the more likely path would be found through some combination of the second and fourth of the six scenarios we projected. This newspaper argued that the war would end via the intersection of two of those scenarios, scenarios two and four.

That now appears to be exactly what has happened.

Scenario two allowed for a strategic exit by Washington after securing enough of its central objectives to declare success and step back from the conflict. Scenario four allowed for controlled de-escalation by Iran, in which Tehran could step back from escalation.

The peace deal set to be signed later this week essentially comes down to exactly that.

Under the reported terms, Iran is expected to promise to freeze its nuclear weapons programme, with the longer-term aim of destroying its enriched uranium stockpile and dismantling its nuclear capabilities. In return, the US is expected to release around $25 billion in frozen Iranian assets and grant waivers for the export of Iranian crude oil, petrochemicals, and related banking and insurance services. The Strait of Hormuz is also expected to reopen for toll-free international shipping, following the removal of the US naval blockade.

It is a negotiated outcome that gives Washington enough to claim that the nuclear threat has been contained, while giving Tehran enough economic relief to step back from escalation.

Markets throughout held to The Common Sense’s initial predictions. Oil largely held at a level not way out of line with its inflation-adjusted averages of the past decade. The dollar strengthened only marginally. And markets held up strongly.

Oil prices fell sharply after the deal was announced, with Brent falling by about 4.1% to below $84. Global equities moved higher, investors began removing the geopolitical risk premium from energy prices, and the rand strengthened to near R16.15 against the dollar from around R16.50 a week earlier.

Looking ahead, Frans Cronje told The Common Sense, “Remember that the warfighting aspect of the conflict had already largely ended by day 39, when the initial ceasefire was agreed, and that subsequent to that what was still called a war was not really that, but more a diplomatic and economic impasse, the pressure of which has now done its work to force both sides into a truce. The Americans will be satisfied that they have substantively set back Iran’s nuclear programme and shifted the fulcrum of the global oil industry out of the Middle East and into the Americas. The Iranians will feel that they have done well to have frozen assets released and for their regime to have survived essentially intact. Flare-ups and small crises should be expected, but the direction of travel of the conflict has been clear since its early days and now seems to be playing out exactly as we expected.”