Iran is reportedly fortifying sensitive nuclear sites in preparation for American strikes in the near-future. President Trump has stated the US will not attack until after the midterms, but has left options on the table after November 3rd.

Diplomacy is close to dead near-term, with the two sides still split on sanctions relief and enrichment and Trump ruling out deals until at least the election, leaving formal negotiations in the next 30 days at just 6%.

The model reads Trump as more likely to resume strikes after November 3 to strengthen his hand, consistent with prior US hits on Iranian nuclear sites, putting major new strikes before year-end at 70%, while a fragile leadership in Tehran leaves a 40% chance Mojtaba Khamenei is out as supreme leader by year-end.

A near-term off-ramp looks all but closed, keeping both the energy shock and the political damage in place.

The grinding war and the oil prices that come with it are weighing on Republicans heading into the vote, part of why the model now has Democrats at 66% to take the Senate.

With no end in sight, oil stays expensive as Brent carries a war-risk premium, defense makers like Lockheed Martin (LMT) and RTX keep landing orders for the missiles being used up, and the closed Strait of Hormuz keeps shipping costs high by pushing tankers onto longer routes.