Four members of Iran’s Islamic Revolutionary Guard Corps (IRGC) were reportedly killed in joint airstrikes conducted by the United States and Saudi Arabia in Diyala, Iraq, according to the Iranian news agency IRNA. These forces were tasked with securing the Arbaeen pilgrimage, a significant event for Shiite Muslims. The airstrikes are part of a broader regional conflict involving the US, Saudi Arabia, Iraq, and Iran-linked groups. The deaths indicate an escalation of hostilities, as the strikes targeted personnel connected to Iran’s external operations network.

Market pricing suggests this development could increase the likelihood of an Iranian military response against Gulf states. The probability of Iranian military action against a Gulf state by July 30 has risen significantly. This follows the joint US-Saudi operations, which have been framed as a response to drone attacks, further heightening regional tensions.

Key Takeaways

• Market activity suggests increased expectations of Iranian military action against Gulf states following the reported death of IRGC members.
• The July 30 market for Iranian military action against a Gulf state has seen a notable increase in YES pricing, rising from 10% to 27.5%.
• This escalation reflects broader regional tensions involving key state actors like the US, Saudi Arabia, and Iran.

What to Watch

Observers will be monitoring Iran’s response closely, as further military actions could be consistent with current pricing trends. Key figures such as Iranian Supreme Leader Ali Khamenei and President Ebrahim Raisi may issue statements or take actions that could impact market expectations. The possibility of diplomatic interventions or further military engagements in the region remains a critical factor in determining future market movements.

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