The body of Iran’s slain Supreme Leader Ayatollah Ali Khamenei was laid in state at Tehran’s Grand Mosalla Mosque on Friday, July 3, opening six days of ceremonies that Iranian officials are portraying as a demonstration of national resolve following the recent war with the United States and Israel. Parliament Speaker Mohammad Bagher Ghalibaf described the funeral as a renewal of the nation’s commitment to the ideals of the 1979 Islamic Revolution, calling on supporters to continue what he described as Iran’s path of resistance.

Iranian authorities said Khamenei, 86, was killed alongside several members of his family during a joint U.S.-Israeli strike on his compound on February 28, the opening day of the conflict.

State television broadcast images from inside the mosque showing five flag-draped caskets arranged before mourners. Iranian officials said one of the smaller coffins held Khamenei’s one-year-old granddaughter, who they say also died in the strike. Authorities estimate that as many as 20 million people could attend the funeral processions beginning Saturday, potentially exceeding the estimated 10 million who gathered for the 1989 funeral of Ayatollah Ruhollah Khomeini, the founder of the Islamic Republic.

Several foreign delegations arrived in Tehran to pay their respects, including Dmitry Medvedev, deputy chairman of Russia’s Security Council, and He Wei, vice chairman of China’s National People’s Congress. Officials from Pakistan, Iraq, India, Turkey and several other countries also attended, underscoring Iran’s continued diplomatic relationships despite months of conflict and international pressure.

Questions remain over the public role of Mojtaba Khamenei, the late supreme leader’s son and designated successor. Iranian officials have said he was injured in the February strike and has not appeared publicly since, communicating only through occasional written statements. His absence has fueled speculation among diplomats and investors over how Iran’s next leadership chapter will unfold.

The funeral comes as Washington has begun easing some economic restrictions on Iran following a diplomatic framework reached last month. Under the Islamabad Memorandum of Understanding, signed June 17 by President Donald Trump and Iranian President Masoud Pezeshkian, the United States agreed to temporarily ease sanctions on Iranian oil exports, release certain frozen Iranian assets as negotiations continue, support reconstruction planning, and reopen commercial navigation through the Strait of Hormuz.

On June 22, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued a temporary license allowing Iranian crude exports through August 21, 2026, while negotiations continue.

The agreement leaves several of the most contentious issues unresolved, including Iran’s stockpile of enriched uranium, its ballistic missile program, and support for regional proxy groups. On July 1, Ghalibaf reiterated that international inspectors would not be permitted to enter bomb-damaged nuclear facilities.

Some analysts believe the conflict has reinforced the Iranian leadership’s belief that its confrontational strategy succeeded. Narges Bajoghli, an associate professor at the Johns Hopkins School of Advanced International Studies, said the government’s survival following months of military confrontation has strengthened support among some Iranians for its long-standing policy of resistance.

For global markets, the greatest concern remains the Strait of Hormuz, through which roughly 20% of the world’s oil supply passes.

Iranian officials have indicated they are considering imposing transit fees on commercial shipping beginning in mid-August. U.S. Middle East envoy Steve Witkoff has urged Tehran to abandon the proposal during indirect negotiations mediated by Qatar and Pakistan. Meanwhile, Iran’s Khatam al-Anbiya military command warned this week that vessels failing to follow approved transit routes could face military action.

Oil markets have remained relatively calm despite the uncertainty. On Friday, Brent crude traded near $71.76 per barrel, while West Texas Intermediate hovered around $68.41, reflecting investor expectations that the ceasefire will continue to hold.

Even so, higher energy costs continue to affect consumers, with U.S. gasoline prices remaining significantly above year-ago levels following months of disruption across Middle Eastern shipping routes.

Speaking Thursday, U.S. Ambassador to the United Nations Michael Waltz warned that President Trump’s patience “is not unlimited,” accusing Tehran of threatening global commerce through repeated disruptions in the Strait of Hormuz.

Formal negotiations are expected to pause during the funeral period before resuming later this month. Iran has announced that Khamenei’s body will travel to Qom, followed by Najaf and Karbala in Iraq, before his burial in Mashhad on July 9.

As diplomatic talks resume and the deadline for Iran’s proposed Hormuz transit policy approaches, governments and financial markets alike will be watching whether the ceasefire evolves into a lasting agreement—or another period of renewed confrontation.

JBizNews Desk | Tehran

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