Iran warns Gulf states of ‘fireball’ if they back US military operations

Iran has issued a stark warning to Gulf states, indicating that the region could become a “fireball” if they support U.S. military operations. This development arises amid the ongoing Iran-USA conflict in 2026, which has already seen military engagements across the Middle East, including U.S. airstrikes and Iranian retaliatory actions targeting U.S. military sites in countries such as Kuwait, Qatar, and Bahrain. The Iranian warning appears to underscore a high level of escalation, as Tehran views Gulf states as potential targets. This situation has further complicated the geopolitical landscape, where Gulf nations are seeking to avoid direct confrontation despite being affected by attacks on energy and infrastructure facilities. Key Takeaways Iran’s threats against Gulf states suggest heightened regional tensions, consistent with scenarios where a US-Iran deal becomes less likely. The current pricing in prediction markets implies a decrease in the likelihood of Iran Reconstruction Funding being part of a US-Iran deal in 2026, with odds around 30% YES. Markets appear to interpret Iran’s aggressive stance as a significant barrier to diplomatic resolutions, impacting related markets. ...