The death of Iran's Supreme Leader Ali Khamenei has created enormous uncertainty about the country's political future, with Capital Economics outlining four possible scenarios for Iran's path forward. Under Iran's constitution, the 88-member Assembly of Experts will choose a successor while a transitional council governs in the interim.

Capital Economics economist William Jackson identifies the most likely outcome as a status quo scenario where Khamenei's allies maintain hardline policies toward the West. This would keep sanctions in place, potentially pushing oil prices above $100 per barrel during extreme disruptions. Gulf economies would benefit from higher oil revenues but face risks to logistics and tourism sectors.

The second scenario involves rapprochement with the West, possibly triggered by domestic pressure. While sanctions relief would come slowly, oil prices could fall back to $50–$60 per barrel as political risk premiums fade. Jackson notes that Iran's history suggests either the status quo or rapprochement are most probable outcomes.

The third and fourth scenarios involve more dramatic shifts: a democratic transition that could initially spike oil prices before Iranian supply expansion brings them down, or a messy transition creating multiple power centers that might fracture central authority. Both represent lower-probability outcomes but carry significant market implications.