The Situation · Edition 4

Saturday, 4 July 2026

In Tehran, the days-long official mourning ceremonies began for Ayatollah Ali Khamenei, who according to reports was killed in February on the first day of the war between the United States, Israel and Iran. Iranian authorities expected millions of participants, among them representatives of Hamas and Hezbollah. At the same time, Iran's ambassador to China announced that service fees would in future be levied on ships passing through the Strait of Hormuz, a move the United States promptly rejected, while President Trump declared that Washington would prevail in the conflict with Iran one way or another.

At the front, the Ukrainian general staff reported that Russia's oil refining industry had fallen to roughly 42 percent of its capacity as a result of the sustained Ukrainian long-range strike campaign, after eight refineries were hit and more than 60 oil tanks damaged in June. According to Western analysts, neither Ukrainian nor Russian troops made any significant advances along the front, while Moscow repeated its territorial claims as part of its information campaign.

On the economic front, the EU-US trade agreement entered into force, averting a looming tariff escalation: most EU goods will now face a tariff of 15 percent, cars fall from 27.5 to 15 percent, while steel remains at 50 percent. At the same time, the oil price dropped below 70 dollars per barrel, as shipping traffic through the Strait of Hormuz recovered following the memorandum concluded between the United States and Iran in June, and the war premium melted away.

In the technology sector, the United States eased chip export restrictions for the United Arab Emirates, while China's own chip exports in the first half of the year nearly doubled to around 177 billion dollars, evidence of how strongly access to AI semiconductors is now being used as a geopolitical lever.

Hormus-Iran-Krise Iran und Energiepreise Ukraine-Krieg USA-Handelskonflikt Ölmarkt Chip-Exportkontrollen

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Geopolitics

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Iran Begins Khamenei Mourning Ceremonies and Threatens Hormuz Fees

Iran und Energiepreise Hormus-Iran-Krise

In Tehran, the multi-day mourning ceremonies begin for Ayatollah Khamenei, killed on 28 February, with Iran expecting millions of participants. At the same time, Tehran announces that it will impose fees for passage through the Strait of Hormuz, which the United States rejects. The suspended negotiations are set to resume on 11 July.+ more perspectives

On 4 July 2026, the days-long state mourning ceremonies for Ayatollah Ali Khamenei began in Tehran. According to the reports, he was killed on 28 February on the first day of the US-Israeli war against Iran. Iranian authorities stated that they expected 15 to 20 million participants in Tehran over the coming days; according to the Times of Israel, the mourners also included representatives of Hamas and Hezbollah. In parallel, Iran’s ambassador to China declared that Tehran would definitely impose service fees on ships in the Strait of Hormuz, though friendly states would receive special treatment. The United States rejected this and insisted that any agreement must prohibit Iran from levying fees. US President Trump declared that the United States would win the war against Iran one way or another. The sourcing relies on live reports from CNN, CBS and the Times of Israel; the exact participant figures are official Iranian claims and are difficult to verify independently.

CNNThe Times of IsraelCBS News

Geopolitics

Ukraine Pushes Russia’s Refining Capacity Down to Just Over 42 Percent

Ukraine-Krieg

On 4 July, the Ukrainian General Staff reported that Russia’s oil refining industry had been pushed down to around 42.5 percent of its design capacity by sustained strikes. Neither Russian nor Ukrainian ground troops advanced that day. According to the ISW, Russia spread exaggerated reports of success.+ more perspectives

On 4 July 2026, the Ukrainian General Staff announced that Russia’s oil refining industry had fallen to 42.47 percent of its total design capacity as a result of the ongoing Ukrainian long-range strike campaign. In June 2026, eight Russian refineries were reportedly hit and more than 60 oil tanks were destroyed or severely damaged, 58 percent of them holding petroleum products and 42 percent holding crude oil. According to assessments by the Institute for the Study of War (ISW) and Critical Threats, neither Ukrainian nor Russian ground troops advanced on 4 July. On the evening of 3 July, Putin had conferred with Chief of the General Staff Gerasimov and several front-line commanders; on 4 July, Russian sources made various territorial claims that the ISW classifies as part of the Russian information campaign. The figures on refining capacity and troop movements come predominantly from Ukrainian or Western sources and can only be independently verified to a limited extent.

Critical Threats (ISW)Kyiv PostAl Jazeera

Economy

EU-US Tariff Deal With 15 Percent Cap Takes Effect

USA-Handelskonflikt

Shortly before the 4 July deadline, the EU gave final approval to its trade agreement with the United States. Since 1 July, an all-inclusive US tariff of 15 percent has applied to most EU goods, while in return EU tariffs on US industrial goods are eliminated. Cars fall from 27.5 to 15 percent, while steel remains at 50 percent.+ more perspectives

Around 4 July 2026, the trade agreement between the EU and the United States took effect, averting a looming tariff escalation. As of 1 July, an all-inclusive US tariff of 15 percent applied to most goods of EU origin, one that is not added on top of the regular MFN rates: goods with lower MFN rates pay 15 percent in total, while those with higher rates pay only the MFN rate. In return, the EU abolished all tariffs on imports of US industrial goods and improved market access for certain agricultural products. Cars fall from 27.5 to 15 percent, pharmaceuticals and semiconductors are capped at 15 percent, while steel remains at 50 percent. The framework goes back to the July 2025 agreement between Commission President von der Leyen and President Trump and has now been formally confirmed by Parliament and Council. The details rely on official European Commission information as well as analyses by law firms and the Tax Foundation; certain exemptions (for example from September) still require further clarification in their implementation.

Europaeische KommissionSullivan & CromwellThe Daily Pioneer

Oil Price Falls Below 70 Dollars as War Premium Fades

Hormus-Iran-Krise Ölmarkt

At the start of July, the Brent spot price fell below 70 dollars per barrel, back to its level from before the Iran conflict. The recovery of shipping through the Strait of Hormuz caused the war premium to melt away. In June, Brent had still averaged 85 dollars.+ more perspectives

In the days around 4 July 2026, the decline in oil prices continued: the Brent spot price fell below 70 dollars per barrel on 1 July, back to its level from before the conflict that began on 28 February. The reason was the recovery of shipping through the Strait of Hormuz, after the United States and Iran had signed a Memorandum of Understanding on 18 June to end the conflict and open the strait. As a result, the previously priced-in war premium melted away. In June, the Brent price had still averaged 85 dollars, around 22 dollars below the May average. Heading into the weekend, the market was reportedly on course for its fourth consecutive week of losses. The price figures come from market reports by The National, CNBC and the EIA; the trend remained fragile given the unresolved Hormuz question and reversed again over the further course of the month.

The NationalU.S. EIA

Technology

US Eases AI Chip Exports for the UAE

Chip-Exportkontrollen KI-Boom

In a notice published on Friday, the US administration stated that the United Arab Emirates will in future find it easier to buy advanced technologies, including AI semiconductors. The Commerce Department cited measures by the UAE to protect sensitive US technology. At the same time, data show that China’s chip exports nearly doubled in the first half of the year.+ more perspectives

Around 4 July 2026, it emerged that the Trump administration is easing export restrictions for the United Arab Emirates, thereby clearing the way for the purchase of advanced technologies, including the semiconductors needed for AI. According to a notice published on Friday by the US Commerce Department, the UAE now qualifies for eased treatment under US export control laws, justified by steps taken by the Emirates to protect sensitive American technology. In parallel, foreign trade data show that China’s chip exports nearly doubled in the first half of 2026: 179.44 billion integrated circuits worth around 177 billion dollars, an increase of more than 96 percent over the previous year. The move shows how the United States is using access to AI chips as a geopolitical instrument. The information relies on reports by Bloomberg and the South China Morning Post; the concrete design of the easing was not yet public in all its details at the time of reporting.

BloombergSouth China Morning Post