The battle begins': Defiant Khamenei responds to Trump’s threats, Iran claims hypersonic missile attack

Tehran/Washington D.C., June 18, 2025 – The simmering tensions between the United States and Iran have once again flared up dramatically. Iran's Supreme Leader Ayatollah Ali Khamenei issued a bold, combative response to former U.S. President Donald Trump's threats, stating, “The battle begins.” His remarks come amid claims by Tehran that it successfully deployed a hypersonic missile in a retaliatory strike on undisclosed targets in the region, escalating fears of a new cycle of Middle Eastern conflict.

Khamenei’s Defiance: ‘We Do Not Bow to Bullies’

Speaking to a tightly controlled assembly of Iran’s Revolutionary Guard Corps (IRGC) and senior military officials in Tehran, Ayatollah Khamenei dismissed Trump’s “provocative language” as “obsolete bullying from a failed imperialist.” He warned that any attempt to undermine Iranian sovereignty would be met with “unmatched retaliation, far beyond what our adversaries expect.”

“The enemies thought economic pressure and cyber sabotage could break us,” Khamenei declared. “But we have developed defense systems and missile technologies that render their threats hollow. The battle begins not in words, but in deeds.”

Iran's Hypersonic Strike: A Regional Game-Changer?

The Islamic Revolutionary Guard Corps (IRGC) claimed on Tuesday that Iran had launched its first successful hypersonic missile attack, targeting what it called a “strategic hub of Zionist-American intelligence collaboration.” While Iranian media reported the attack occurred near a military site in northern Iraq, Western intelligence agencies have yet to confirm the location or the extent of the damage.

According to Brigadier General Amir Ali Hajizadeh, head of the IRGC Aerospace Force, the missile used was a domestically developed Fattah-2, capable of speeds exceeding Mach 10 and equipped with evasive maneuvering capabilities to bypass advanced missile defenses.

“This marks a turning point,” said General Hajizadeh. “We now have a deterrent that cannot be intercepted. If war is imposed on us, we will dictate the battlefield.”

Trump’s Threats Reignite Old Fires

Former U.S. President Donald Trump, during a recent rally in Florida, warned that Iran “will pay a price like never before” if it continues to threaten U.S. allies or military assets. Trump’s comments followed reports of increased Iranian drone surveillance over U.S. bases in Iraq and Syria.

While Trump is currently campaigning for the Republican nomination in the 2026 election, his statements have already reverberated globally, particularly in financial markets, oil futures, and defense stocks.

Political analyst Dr. Samira Fazeli of Georgetown University notes, “Trump’s hawkish rhetoric, combined with Iran’s missile escalation, is a dangerous cocktail. It mirrors the brinkmanship of 2019 but now with higher stakes due to hypersonic capabilities.”

Market Reaction: Oil Surges, Defense Stocks Rally

The geopolitical unrest has already begun to affect markets. Brent crude spiked 4.7% to $91.40 per barrel on Tuesday, with traders pricing in potential supply disruptions across the Strait of Hormuz — a crucial waterway for global oil transit.

Defense stocks also saw a rally. Shares of Northrop Grumman and Lockheed Martin climbed 3.2% and 2.9%, respectively, amid speculation of increased U.S. defense spending. The VIX index, a common measure of market volatility, jumped 12%, reflecting heightened investor anxiety.

“Any credible claim of hypersonic missile use is a red flag for market stability,” said Amanda Coles, geopolitical risk strategist at Vanguard. “It alters the defense calculus for both allies and adversaries in the region.”

Analysts Weigh In: A Hypersonic Arms Race?

The global implications of Iran's alleged hypersonic capability are profound. If confirmed, it would place Iran among a small group of countries—China, Russia, and the United States—that have operational hypersonic weapons. This could provoke a strategic recalibration across the Gulf and beyond.

“Saudi Arabia, Israel, and even Turkey may now feel compelled to accelerate their missile defense upgrades or pursue similar technologies,” said Dr. Evan Rosenberg, a senior fellow at the Center for Strategic and International Studies (CSIS). “This sets the stage for a regional hypersonic arms race.”

Israel’s Ministry of Defense has yet to comment on Iran’s claims, though unverified reports suggest Israeli Iron Dome and David’s Sling systems were on high alert Tuesday night.

Investor Outlook: Caution with an Eye on Commodities

Investors are advised to stay cautious amid rising geopolitical volatility. With Iranian threats escalating, and Trump amplifying tensions, portfolios heavily exposed to Middle Eastern markets, travel, or energy-sensitive industries may see short-term volatility.

However, commodity traders could find opportunities in energy, particularly in oil and natural gas, which are likely to remain bullish under the current climate.

“The upside risk to oil prices is real,” said Colin Matthews, energy fund manager at BlackRock. “But overexposure can be risky if diplomatic backchannels cool tensions unexpectedly.”

A Dangerous Crossroads

The current standoff between the U.S. and Iran, fuelled by old animosities and new military technologies, poses one of the gravest risks to regional stability since the Soleimani assassination in 2020. While both sides maintain they do not seek all-out war, the rhetoric and military posturing indicate that miscalculation is more possible than ever.

As Ayatollah Khamenei declared the start of “the battle,” and Donald Trump vowed decisive action, the world watches with bated breath. The escalation underscores the fragility of peace in a region already strained by proxy wars, sectarian divides, and global power rivalries.