The market resolves YES if the US military invades the Kharg Island, located 15 miles off Iran's coast and through which approximately 90% of Iran's crude exports pass. Invasion is defined as the takeover of the Island by deployment of troops from any party of the coalition or it's proxies, OR the surrender of the island to the US, due aerial-naval blockade/bombardment. The market resolves NO if this does not occur by December 31, 2026.

Resolution will be determined by credible reporting from major news outlets (Reuters, AP, Bloomberg, BBC, etc.) confirming sustained US military operations on the island or its surrender. Temporary military strikes or damage to facilities do not constitute invasion/control, unless if there's troops on the ground OR total surrender caused by said strikes.

A US-Israel conflict with Iran began on February 28, 2026, with opening strikes that killed Supreme Leader Ali Khamenei and triggered hundreds of retaliatory missiles and thousands of drones from Iran. Trump administration officials told Axios that seizing Kharg Island has been discussed, though analysts note that any attempt to seize it would likely require a ground troop operation, which the U.S. appears reluctant to undertake.

An attempt to seize the island would require U.S. troops on the ground and likely see it become a multiweek target for Iranian drones, and could push oil prices up even further while Tehran may consider self-sabotage to destroy the oil pipeline feeding it.

Control of this Island could significantly increase american bargaining power and pressure over Iran, as well as allow for the construction of an american military base there, working as an unsinkable aircraft carrier and a strategic point to control Iranian trade, especially in case of a Venezuela-style outcome, in which Iran would need to be dependant on the US and under American mercy for political control to be maintained.

Kharg Island is one of Iran's best defended sites, having been heavily fortified after damage during the Iran-Iraq War. A landing operation would be a major escalation, requiring physically taking or neutralizing a strategic island close to the Iranian coast while exposed to Iranian missiles, drones and naval retaliation—a much bigger step than an airstrike. President Trump faces political pressure at home over rising fuel prices ahead of the U.S. midterm elections, and a major disruption to Iranian oil exports could further destabilize global markets.