Are there not any air units in this version of the game???
No, unlike the original Oil War, the effects of airpower are subsumed into the rules for combat and movement. There are basically three effects/phases to this:
Once per turn the Coalition player gets to designate any one hex as a target for an overwhelming airstrike (this can be anywhere on the map and doesn't require the Iranian target units to be in direct contact with Coalition forces); the Coalition player rolls a die, halves the result (rounding down), and eliminates that many Iranian units from the target hex. This tends to discouage the Iranian player from massing his best units into powerful "kill stacks," and is an effective way of showing the deadly power of concentrated deep strikes.
Starting on Turn 3, the movement rating of all Iranian units begins to fall off (from 6 down eventually to just 2). This is intended to show the effects of Coalition air interdiction and gradual depletion of Iranian logistical stocks.
Starting on Turn 6, all Iranian attacks start to suffer adverse column shifts (while Coalition attacks receive automatic bonus column shifts); the number of shifts increases over time. This basically represents the effects of close air support.
Overall, while the system is a bit less satisfying that the original game's rather abstracted air war, it does a reasonable job of showing the aggregate effects of Coalition airpower as more and more forces flow into the theater while Iranian airpower is attritioned down to ineffectiveness.
The biggest gripe I've heard is that there ought to be some provision early on for an Iranian airpower "surge" that gives their opening attacks some (small) level of benefit, but at the expense of accelerating the adverse effects of Coalition airpower against them (e.g. allow the Iranians to "use up" their Air Force faster). It'd be pretty easy to craft a simple house rule to reflect this option.