The Institute for the Study of War (ISW) and The Critical Threats Project (CTP) at the American Enterprise Institute are publishing daily updates to provide analysis on the war with Iran. The updates cover events from the past 24-hour period.
Key Takeaways
- Iran has signaled that it will continue to use force to compel vessels to exclusively use the Iranian traffic separation scheme in the Strait of Hormuz as part of the broader Iranian effort to assert its claimed control of the strait. Iran has repeatedly attacked vessels in the strait to coerce them to use the illegal Iranian traffic separation scheme and thus implicitly recognize Iranian control over the waterway.
- Iranian forces may have launched an effort against Kurdish militancy around the Iran-Iraq border. The exact military objectives are unclear at this time.
Toplines
Iran has signaled that it will continue to use force to compel vessels to exclusively use the Iranian traffic separation scheme in the Strait of Hormuz as part of the broader Iranian effort to assert its claimed control of the strait. Iran’s top operational military headquarters, the Khatam ol Anbia Central Headquarters, warned on July 2 that Iran will deliver a “decisive and swift” response to any US interference in Iranian efforts to manage the strait.[1] The statement added that all oil tankers and commercial vessels must use the Iranian-designated route for safe passage and warned that the armed forces will respond to any vessel that uses an alternative route.[2] Iran has repeatedly attacked vessels in the strait to coerce them to use the illegal Iranian traffic separation scheme and thus implicitly recognize Iranian control over the waterway.[3] Iranian Deputy Foreign Affairs Minister for Legal and International Affairs Kazem Gharibabadi said on July 2 that the strait is under Iranian control, not that of US Central Command (CENTCOM), after CENTCOM hosted a regional security meeting in Bahrain with military commanders from Gulf and other regional states.[4] The meeting in Bahrain comes amid Gulf opposition to Iranian control over the strait.[5] Iran is meanwhile conducting a concerted diplomatic and military effort in response to the apparent resistance from Gulf countries to try to deter any international efforts to restore maritime traffic outside Iranian control.[6] Iran recently attacked commercial vessels in the strait after the International Maritime Organization (IMO) and Oman announced a new route on June 23 to move hundreds of stranded vessels through the strait through a designated safe route along the Omani coast, for example.[7]
Iranian forces may have launched an effort against Kurdish militancy around the Iran-Iraq border. Iranian forces conducted missile and drone attacks targeting Kurdish militias around Erbil and Sulaymaniyah in Iraqi Kurdistan on July 2.[8] The Islamic Revolutionary Guards Corps (IRGC) Ground Forces Hamzeh Seyyed ol Shohada Operational Base separately announced on July 2 that it ambushed a Democratic Party of Iranian Kurdistan (PDKI)-affiliated cell that entered Iran through the northwestern border and killed five of its members near Piranshahr, West Azerbaijan Province.[9] The IRGC claimed that the group carried improvised explosive devices.[10] Kurdistan Free Life Party (PJAK) separately confirmed on June 30 that the IRGC killed four of its members during clashes with IRGC Ground Forces Hamzeh Seyyed ol Shohada Operational Base personnel near Mahabad and Piranshahr in West Azerbaijan Province.[11] Unspecified armed individuals separately killed two IRGC personnel and injured two others in Paveh, Kermanshah Province, on June 30.[12] These operations come after Armed Forces General Staff-run outlet Defa Press stated on June 20 that the regime is closely monitoring fighters in Kurdistan, West Azerbaijan, and Kermanshah provinces and has replaced “purely defensive reactions” with an “active deterrence” doctrine.[13]
US-Iran Negotiations
Nothing significant to report.
Maritime Activity in the Strait of Hormuz and Persian Gulf
See topline section.
Iranian Domestic Affairs
A group of Iranian parliamentarians, largely comprised of individuals aligned with the ultra-hardline Paydari (Stability) Front, released a statement endorsing a different statement from some Assembly of Experts members that implicitly criticized the US-Iran memorandum of understanding (MoU) and US-Iran negotiations.[14] Iranian media reported on July 2 that a group of at least 84 parliamentarians issued a statement endorsing the recent statement by some Assembly of Experts members on June 28.[15] Sixty Assembly members issued a 10-point statement on June 28 in which they warned negotiators not to violate Supreme Leader Mojtaba Khamenei’s red lines.[16] The Assembly of Experts Secretariat later clarified that the June 28 statement did not represent the Assembly’s official position.[17] The statement from the parliamentarians echoes the Assembly members’ hardline demands, which include solidifying Iranian control over the Strait of Hormuz, securing frozen assets and sanctions relief, forcing a US withdrawal from the region, and not discussing Iran’s nuclear program in talks with the United States.[18] The Assembly of Experts and parliamentarians’ statement reflects ongoing divisions within the regime between pro-negotiation factions that appear more willing to preserve negotiations and the MoU and anti-negotiation factions who continue to push maximalist and uncompromising positions.
US and Israeli Air Campaign
Nothing significant to report.
Lebanese Hezbollah and the Israeli Campaign in Lebanon
The Israel Defense Forces (IDF) has reportedly improved its ability to detect hostile first-person view (FPV) drones in northern Israel and southern Lebanon.[19] An unnamed senior IDF official told Israeli media on July 2 that IDF advancements in radar, artificial intelligence, and communication links to warning systems have reduced vulnerability to FPV drone attacks in southern Lebanon by 10 percent.[20] It is unclear how the official defines vulnerability to FPV drones, however. The official also said that drone warnings reach Israeli forces in southern Lebanon “within a few seconds,” giving soldiers more time to find cover or attempt to neutralize the drone.[21] The IDF reportedly began examining FPV drone countermeasures for its forces in southern Lebanon in April 2026.[22] Hezbollah has conducted increasingly sophisticated FPV drone attacks on Israeli forces in northern Israel and southern Lebanon since March 2026, including “swarm” attacks and nighttime attacks with FPV drones equipped with thermal cameras.[23]
The IDF continued to strike Hezbollah fighters and clear Hezbollah infrastructure in southern Lebanon on July 2. The IDF reported on July 2 that its forces killed a Hezbollah fighter who emerged from an underground facility near Ali al Taher, Nabatieh Governorate.[24] The IDF reported on June 26 that its forces took “complete control” of Ali al Taher, which reportedly hosts one of Hezbollah’s largest underground command-and-control facilities.[25] Approximately 30 Hezbollah fighters remain in the facility, according to Israeli media.[26] Lebanese media reported on July 2 that the IDF conducted a one-way attack drone strike near Yater, Nabatieh Governate.[27] The IDF also reported on July 2 that it recently seized two Hezbollah weapons caches in Nabatieh Governate that contained rockets, mortars, improvised explosive devices, and other weapons.[28]
Other Axis of Resistance Activity
The United States has resumed some dollar shipments to Iraq, according to Iraqi federal government spokesperson Haider al Aboudi and a financial adviser to Iraqi Prime Minister Ali al Zaydi speaking to the New York Times.[29] Qatari media previously reported on June 17 that the United States recently delivered two shipments of US dollars to the Iraqi Central Bank, which coincided with US Special Envoy Tom Barrack’s visit to Baghdad.[30] The US dollar shipments were the first sent to Iraq since the US Treasury Department halted such shipments in April 2026 due to concerns about Iranian-backed Iraqi militia attacks during the war.[31] The Iraqi Central Bank has managed an account at the New York Federal Reserve that has held the Iraqi government’s oil export revenue in US dollars since 2003.[32] The resumption of US dollar shipments comes after Zaydi launched an anti-corruption campaign on June 28 targeting dozens of senior Iraqi officials following US pressure on the Iraqi government to disarm Iranian-backed Iraqi militias, dismantle their financial networks, and combat corruption.[33] The United States reportedly conditioned economic support, likely including dollar shipments, for Zaydi’s government on the Iraqi government’s ability to meet US demands.[34]
An unnamed Iraqi official told the New York Times that the United States has not resumed its funding for Iraqi security services, however.[35] The United States suspended its funding for some counterterrorism and Iraqi Security Forces (ISF) training programs in April 2026 to pressure the Iraqi federal government to “dismantle” the militias.[36]
[1] https://t.me/farsna/445983
[2] https://t.me/farsna/445983
[3] https://www.reuters.com/world/middle-east/iran-insists-right-control-shipping-strait-hormuz-after-ship-hit-near-oman-2026-06-26/ ;
https://www.wsj.com/world/middle-east/iran-attacks-cargo-ship-testing-trumps-deal-to-reopen-strait-d3cf454c ;
https://understandingwar.org/research/middle-east/iran-update-special-report-june-27-2026/ ; https://twitter.com/UK_MTO/status/2070160682264269241
[4] https://x.com/Gharibabadi/status/2072490568937001427?s=20
[5] https://www.state.gov/releases/office-of-the-spokesperson/2026/06/joint-statement-following-the-ministerial-meeting-of-the-united-states-and-the-gulf-cooperation-council-gcc
[6] https://t.me/farsna/445983 ; https://twitter.com/Gharibabadi/status/2072490568937001427?s=20
[7] https://www.imo.org/en/mediacentre/pressbriefings/pages/imo-accounces-evacuation-plan-in-strait-of-hormuz.aspx ;
https://www.imo.org/en/mediacentre/pressbriefings/pages/statement-on-the-attack-in-strait-of-hormuz-evacuation-plan-pause.aspx
[8] https://t.me/Nournews_ir/369055?single
[9] GRAPHIC: https://t.me/Tasnimnews/427243
[10] https://www.reuters.com/business/media-telecom/irans-revolutionary-guards-say-they-killed-kurdish-militants-northwest-iran-2026-07-02/ ;
GRAPHIC https://t.me/Tasnimnews/427243 ;
https://farsnews dot ir/Qaysar/1782993630596530224/Separatist-Terrorist-Group-Dismantled-in-Northwestern-Iran
[11] https://x.com/bbcpersian/status/2072072580446433365?s=20 ;
https://t.me/Nournews_ir/368591
[12] https://t.me/irna_1313/423039
[13] https://t.me/defapress_ir/61408
[14] https://farsnews dot ir/Fatemeh_nazemi/1782997844762747581
[15] https://farsnews dot ir/Fatemeh_nazemi/1782997844762747581;
https://www.irna dot ir/news/86194414
[16] https://www.irna dot ir/news/86194414
[17] https://www.tabnak dot ir/fa/news/1381981
[18] https://www.irna dot ir/news/86194414 ; https://t.me/farsna/446036
[19] https://www dot mako.co.il/news-military/2026_q3/Article-ee104048a922f91026.htm
[20] https://www dot mako.co.il/news-military/2026_q3/Article-ee104048a922f91026.htm
[21] https://www dot mako.co.il/news-military/2026_q3/Article-ee104048a922f91026.htm
[22] https://www.mako dot co.il/news-military/2026_q2/Article-fc8212cd843dd91026.htm
[23] https://www.i24news dot tv/en/news/israel/defense/artc-hezbollah-launches-largest-drone-swarm-attack-on-israel-s-northern-border; https://t.me/mmirleb/16608 ; https://t.me/mmirleb/16536 ; https://www.kan dot org.il/content/kan-news/defense/1045237/
[24] https://x.com/idfonline/status/2072690069576483052 ; https://t.me/BenTzionM/7884
[25] https://x.com/CaptainElla1/status/2070529500639531054 ; https://www.nytimes.com/2026/06/24/world/middleeast/israel-lebanon-hezbollah-fighters-tunnels.html
[26] https://x.com/manniefabian/status/2072690501262733691
[27] https://t.me/sameralhajali/8360 ; https://t.me/sameralhajali/8362
[28] https://x.com/idfonline/status/2072654847120232662
[29] https://www.nytimes.com/2026/07/02/world/middleeast/iraq-us-dollar-transfers-resumes.html
[30] https://understandingwar.org/research/middle-east/iran-update-special-report-june-16-2026-2/ ; https://www.alaraby.co dot uk/economy/خاص-وصول-دفعتين-من-الدولار-نقداً-إلى-بغداد-تزامنا-مع-زيارة-توم-براك
[31] https://www.wsj.com/world/middle-east/u-s-blocks-iraqs-dollar-shipments-to-squeeze-its-iran-backed-militias-3270d5af ; https://understandingwar.org/research/middle-east/iran-update-special-report-april-22-2026/ ; https://www.alaraby.co dot uk/economy/خاص-وصول-دفعتين-من-الدولار-نقداً-إلى-بغداد-تزامنا-مع-زيارة-توم-براك
[32] https://eprints.lse.ac.uk/122652/1/MEC_a_fistful_of_dinars_paper_85.pdf
[33] https://understandingwar.org/research/middle-east/iran-update-special-report-june-29-2026/ ; https://shafaq dot com/ar/سیاسة/حصري-حملة-مكافحة-الفساد-تستهدف-كثر-من-200-شخصية-خلال-72-ساعة-وتستمر-ستة-شهر ; https://almadapaper dot net/441193/ ; https://ina dot iq/ar/political/266920-47.html
[34] https://understandingwar.org/research/middle-east/iran-update-special-report-june-16-2026-2/ ; https://www.alaraby.co dot uk/economy/خاص-وصول-دفعتين-من-الدولار-نقداً-إلى-بغداد-تزامنا-مع-زيارة-توم-براك ; https://almadapaper dot net/439458/
[35] https://www.nytimes.com/2026/07/02/world/middleeast/iraq-us-dollar-transfers-resumes.html
[36] https://understandingwar.org/research/middle-east/iran-update-special-report-april-22-2026/ ; https://www.nytimes.com/2026/04/21/world/middleeast/us-iraq-security-cooperation.html
