According to a Wednesday report from The New York Times, citing officials and others familiar with the discussions, military planners are developing options for a short but intensive bombing campaign intended to pressure Iran into accepting a negotiated settlement.
President Donald Trump has not approved the proposed strikes, and a final decision could depend on diplomatic developments over the coming weeks.
U.S. and Israel Preparing for Possible Military Action
Defense Secretary Pete Hegseth reportedly discussed the possibility of renewed attacks during meetings with Israeli Prime Minister Benjamin Netanyahu in Israel this week. Possible targets include Iranian nuclear facilities, energy infrastructure, and stockpiles of missiles and drones.
One potential target is Pickaxe Mountain, a heavily fortified underground facility linked to Iran’s nuclear program that Trump recently suggested the United States might attack.
Some U.S. officials reportedly believe that another concentrated military campaign could severely weaken Iran’s economy and force its leadership to make concessions after nearly eight months of conflict. However, Trump has repeatedly delayed or rejected proposals for renewed attacks, including an Israeli operation reportedly planned for earlier this month.
Why the Midterm Elections Matter
The timing of the proposed strikes is significant. Trump said earlier this month that the United States would not launch new attacks against Iran before the November 3 elections. The president has also suggested that the conflict could end shortly after Americans vote, either through negotiations or additional military pressure.
One major concern is the effect renewed fighting could have on energy prices, which have already risen sharply because of disruptions to Middle Eastern oil shipments. Higher gasoline and diesel prices could create additional political difficulties for Republicans ahead of the elections.
A decision to delay military action would also give the administration more time to pursue a diplomatic agreement while avoiding another escalation before voters head to the polls.
Israel faces its own political uncertainty, with national elections scheduled for October 27. Netanyahu has reportedly supported renewed military action, although Washington has resisted some previous proposals.
Iran Warns of a Much Wider War
Iranian officials have warned that another American or Israeli offensive would trigger significant retaliation, potentially extending beyond traditional military targets.
Tehran has reportedly considered expanding its targets to include American-linked data centers, artificial intelligence facilities, energy infrastructure, and undersea communications cables throughout the Persian Gulf. Iran could also attempt to intensify disruptions to oil shipments through the Strait of Hormuz, a critical passage for global energy supplies.
These threats raise questions about whether Washington could contain a new campaign to a limited number of days. Even if U.S. and Israeli strikes were designed to end quickly, Iran could respond with attacks across the region, potentially drawing Saudi Arabia and other American partners further into the conflict.
Iranian officials have maintained that they will resist additional military pressure and have demanded the easing of U.S. restrictions before resuming direct negotiations.
What Renewed Strikes Could Mean for Oil Prices and Financial Markets
For investors, the immediate concern is the possibility of another sharp increase in energy prices.
Iran’s ability to interfere with shipping through the Strait of Hormuz has already disrupted global oil and natural gas supplies. Another escalation could create additional volatility, particularly if attacks damage production facilities, refineries, pipelines, or shipping infrastructure.
Several areas of the financial markets could be affected:
- Oil and gasoline: Expanded fighting could increase crude prices, raising transportation, manufacturing, and consumer costs.
- Inflation and interest rates: Higher energy costs could complicate efforts to control inflation and reduce the Federal Reserve’s flexibility to lower interest rates.
- Stocks: Airlines, transportation companies, and other energy-intensive businesses could face margin pressure, while some energy and defense companies could benefit from increased demand or prices.
- Gold and other safe-haven assets: A broader conflict could increase demand for investments traditionally favored during periods of geopolitical uncertainty.
However, higher oil prices are not inevitable. Alternative export routes have helped Middle Eastern producers move additional supplies around the Strait of Hormuz, potentially reducing some of Iran’s leverage.
The biggest variable may be the scale of Iran’s retaliation rather than the initial American and Israeli operation. A limited exchange could produce a temporary market reaction, while sustained attacks on regional energy infrastructure could have much longer-lasting economic consequences.
Military Preparations Could Also Increase Pressure for a Deal
Despite the reported preparations, another major bombing campaign remains uncertain.
The United States has repeatedly used military pressure and economic sanctions in efforts to force Tehran back to negotiations. Some officials believe the threat of additional attacks could encourage concessions without requiring another prolonged military operation.
However, nearly eight months of conflict have failed to produce a comprehensive agreement, raising questions about whether another round of strikes would change Iran’s position.
Trump has also demonstrated a willingness to cancel planned operations, and diplomatic efforts involving regional mediators are continuing. That leaves several possible outcomes, including a negotiated agreement, a limited military campaign intended to increase pressure, or a broader confrontation if Iran responds more aggressively than Washington anticipates.
What Happens Next?
The next two weeks could be critical. Israel holds its election on October 27, followed by the U.S. midterm elections on November 3. U.S. and Israeli officials are reportedly reviewing military options that could be implemented after those elections.
Investors should watch for further U.S. military deployments, progress in negotiations with Tehran, Iranian threats against regional infrastructure, and changes in global oil prices.
For now, the reported plans represent a potentially significant escalation in the Iran conflict, but military action has not been authorized. Whether the United States proceeds could determine the next major move in oil prices, inflation expectations, and financial markets.
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