Iran has launched a major military operation against Kurdish separatist groups in Erbil, escalating the ongoing 2026 Kurdish–Iranian crisis. The strikes, which include missiles and drones, target Iranian Kurdish opposition factions such as Komala, KDPI, and PAK, which Iran accuses of plotting uprisings with alleged U.S. intelligence support. The attacks have been ongoing since February 2026, with Iraqi Kurdish authorities maintaining neutrality.
Regional tensions and wider conflict
The operation is part of a broader conflict involving Iran, the United States, and Israel, and reflects heightened regional instability. Iran's aggressive stance against the Kurdish groups appears to be a response to perceived threats from within Iraq's Kurdistan Region. The situation has raised concerns about further escalation, particularly given the involvement of major powers.
Strait of Hormuz market impact
Market pricing indicates a drop in confidence that Strait of Hormuz traffic will normalize by August 31, with current odds at only 12% YES. The military action in Erbil, combined with ongoing tensions in the Strait, could further affect market expectations. Analysts are watching for official statements from Iranian and U.S. leaders, as well as any diplomatic developments involving Ayatollah Ali Khamenei, Masoud Pezeshkian, and Donald Trump.