The Islamic Republic’s rapid consolidation of power after Supreme Leader Ali Khamenei’s death in a February 2026 U.S.-Israeli strike has anchored trader expectations against Reza Pahlavi assuming leadership. A new hard-line supreme leader succeeded him, protests were contained, and a ceasefire preserved the existing system without external backing for monarchical restoration or exile-led transition. Pahlavi’s calls for a referendum on governance have not translated into organized domestic momentum or U.S. endorsement, amid donor fatigue and opposition fragmentation. With months remaining in 2026, only an unforeseen nationwide uprising or abrupt policy reversal could reopen any path for the exiled opposition figure.