Iran-Israel war: Here's what we know so far

Geopolitical risk for markets stand elevated as Israel and Iran war is on the brink of major escalation. Iran and Israel have been at loggerheads for decades, but they have never gone into a major escalatory scenario, until now. Post the 1980 Islamic revolution, Iran became a staunch opponent of Israel, which turned them into enemies and engaged in shadow wars for decades. Iran has also been secretly enriching huge amounts of uranium for building nuclear weapons. Post the fallout of the US from the nuclear deal between Iran and the US, the prior has enriched close to 60% uranium (close to weapons grade).

Israel has since then been targeting Iran’s nuclear infrastructure as it sees this as an existential threat. President Trump, in his second term, aimed at de-escalating the situation and planned to discuss on new nuclear deal with Iran on June 15. However, Israel carried out pre-emptive strikes on Iran’s capital, Tehran, by launching “Operation Rising Lion”.

On June 13, Israel carried out air strikes with over 200 jets, including explosive drones, on Iranian nuclear and military facilities, including the Natanz uranium enrichment site and, Revolutionary Guards headquarters in Tehran. The strikes allegedly killed several nuclear scientists and senior military commanders. Iran retaliated with 100 drones and 150 ballistic missiles in Israel’s civil areas in Tel Aviv. Iran’s foreign minister termed Israeli strikes a “declaration of war”.

The situation continued to escalate further between June 14 to 16 after talks between Iran and the US were cancelled after Iran deemed them “unjustifiable”. However, rumours and media reports suggested that both countries may agree to a ceasefire. Latest reports and Trump’s evacuation post on X indicate the situation may remain uncertain and escalate further.

Following the escalated conflict, the global markets witnessed an adverse impact as crude oil prices jumped nearly 20% since the operation rising lion began. Gold prices also hovered around record high levels of $3,450 per ounce. Global indices trade in lurk as uncertainty grips investor sentiments.