USD Drops as US Military Strikes Iran Oil Hub Ahvaz, Risk-Off Surges

The US dollar is under significant selling pressure as US military forces struck Ahvaz, the capital of Iran's Khuzestan province and a critical hub in one of the world's largest oil-producing regions. The strike targeted an area just 75-100 km east of the Iraqi border and approximately 150 km north of the Persian Gulf, home to major oil fields including the Ahvaz Oil Field situated along the Karun River. This escalation has triggered a sharp risk-off reaction across forex markets, with safe-haven currencies JPY and CHF strengthening against the dollar. Oil prices have spiked on fears of supply disruption from one of the world's most strategically significant energy corridors. The proximity to critical Persian Gulf shipping lanes raises the stakes for global energy markets. Commodity-linked currencies such as CAD and NOK may see mixed reactions—benefiting from higher oil prices but weighed down by risk aversion. Traders should expect extreme volatility across all major pairs as markets assess the scope of military escalation and potential Iranian retaliation.