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Iran Update Special Report, May 2, 2026
The Institute for the Study of War (ISW) and The Critical Threats Project (CTP) at the American Enterprise Institute are publishing daily updates to provide analysis on the war with Iran. The updates focus on US and Israeli strikes on Iran and Iran and the Axis of Resistance’s response to the strikes. The updates cover events from the past 24-hour period.
NOTE: ISW-CTP will continue posting morning social media threads on an as-needed basis starting April 28, 2026, for the duration of the ceasefire. We will continue providing long-form analysis on the state of the Iran War in our daily Iran Update Special Reports.
Key Takeaways
Iran does not appear to have altered its negotiating position over the management of the Strait of Hormuz and its nuclear program in its latest proposal. Some elements of the Iranian regime may calculate that Iran can impose sufficient economic and political costs on the United States to coerce the United States to make concessions.
Iran is taking steps to try to withstand the US naval blockade. Iran has reportedly begun reducing its oil production as its storage capacity reaches its limits. Iran is likely reducing oil production rather than halting it because shutting down oil production could cause significant damage to Iranian oil fields.
Hezbollah may be domestically producing first-person view (FPV) drones. Hezbollah posted footage on May 2 showing Hezbollah fighters domestically producing drones, but it is unclear if the drones in the video are FPV drones. Hezbollah’s video comes after an Israeli military official told the Associated Press on April 30 that Israel believes that Hezbollah is domestically manufacturing FPV drones.
Toplines
Iran does not appear to have altered its negotiating position over the management of the Strait of Hormuz and its nuclear program in its latest proposal. Some elements of the Iranian regime may calculate that Iran can impose sufficient economic and political costs on the United States to coerce the United States to make concessions. Two senior Iranian officials told the New York Times on May 1 that Iran’s new proposal, which Iran submitted to the United States via Pakistani mediators on April 30, removed a previous condition that required the United States to lift its naval blockade on Iranian ports before Iran and the United States could begin negotiations.[1] Iran’s proposal also reportedly states that Iran is willing to “open” the Strait of Hormuz before the United States announces an end to its blockade.[2] Iran similarly offered to “open” the strait in its previous proposal on April 26, but caveated that it would charge vessels a toll to transit through the strait.[3] Iranian officials have not publicly indicated that the regime will abandon its proposed toll scheme. Supreme Leader Mojtaba Khamenei stated on April 30 that Iran will impose a “new management” in the strait that will reap “economic benefits” for Iran, for example.[4] Iran’s latest proposal also pushes discussions over nuclear issues to a later stage, similar to Iran’s April 26 proposal.[5] ISW-CTP previously noted that any proposal that pushes nuclear negotiations to a later stage would not force Iran to make concessions regarding its highly enriched uranium (HEU) stockpile or ability to enrich uranium up front, but would rather grant Iran more time to engage in talks about these issues.[6] US President Donald Trump expressed dissatisfaction with Iran’s revised proposal on May 1.[7]
Iranian Armed Forces General Staff-run Defa Press argued on May 2 that the war between the United States and Iran has shifted from a direct conflict to a conflict focused on the “imposition of costs.”[8] Defa Press argued that “patience” will be one of the “ultimate determinants of victory,” which suggests that some elements of the regime may be willing to endure the United States’ economic and military pressure while simultaneously imposing economic and political costs on the United States to try to pressure the United States to soften its negotiating demands.
Senior Iranian military and security officials have also expressed pessimism about the prospects for compromise between Iran and the United States. Khatam ol Anbia Central Headquarters Coordination Deputy Brigadier General Mohammad Jafar Asadi and an Iranian security official speaking to Agence-France Presse (AFP) both described renewed military conflict between Iran, the United States, and Israel as “likely” and emphasized that Iranian armed forces remain on full alert.[9] The Khatam ol Anbia Central Headquarters is responsible for joint and wartime operations.
Iran is taking steps to try to withstand the US naval blockade. Iran has begun reducing its oil production as its storage capacity reaches its limits, according to a senior Iranian official speaking to Bloomberg on May 2.[10] Iran is likely reducing oil production rather than halting it because shutting down oil production could cause significant damage to Iranian oil fields.[11] Pentagon officials told Axios on May 1 that 31 tankers carrying roughly 53 million barrels of Iranian oil, worth at least $4.8 billion USD, remain in the Persian Gulf because of the US naval blockade on Iranian ports.[12] The United States has simultaneously expanded economic sanctions to deepen Iran’s isolation and restrict its access to energy markets and financial channels.[13]
Hezbollah may be domestically producing first-person view (FPV) drones. Hezbollah posted footage on May 2 showing Hezbollah fighters domestically producing drones, but it is unclear if the drones in the video are FPV drones.[14] Hezbollah’s video comes after an Israeli military official told the Associated Press on April 30 that Israel believes that Hezbollah is domestically manufacturing FPV drones.[15] The official noted that FPV drones are relatively easy to produce and require minimal additional parts compared to non-FPV drones.[16] Hezbollah has had the ability to domestically produce drones since at least 2011, and prioritized domestic drone production following the Fall 2024 conflict.[17] Israeli media also reported on May 1 that Israel Defense Forces (IDF) Chief of Staff Lieutenant General Eyal Zamir instructed the IDF to target Hezbollah’s FPV drone production and supply chain infrastructure “beyond southern Lebanon.”[18]
Maritime Development
US Central Command (CENTCOM) reported on May 2 that US forces have directed 48 vessels to turn around or return to port since the start of the US blockade on Iranian ports.[19]
US and Israeli Air Campaign
Nothing significant to report.
Iranian Internal Dynamics
Nothing significant to report.
Israeli Campaign Against Hezbollah and Hezbollah Response
Hezbollah has continued to use first-person view (FPV) drones to attack Israeli forces in southern Lebanon.[20] Hezbollah claimed that it used FPV drones in three of its four attacks against Israeli targets on May 2.[21] All of these FPV drone attacks occurred in Biyyadah, southwestern Lebanon, which is an operationally significant town located along a major coastal highway leading to the city of Tyre.[22] Hezbollah has increasingly employed FPV drones in its attacks against Israeli targets since April 22 (see graphic below).[23] Hezbollah also conducted non-FPV drone, rocket, and mortar attacks against Israeli targets on May 2.[24]
The IDF has continued to conduct a high rate of airstrikes targeting Hezbollah infrastructure and fighters in southern Lebanon. The IDF has conducted airstrikes targeting at least 120 Hezbollah sites and fighters in southern Lebanon since CTP-ISW’s last data cutoff on May 1.[25] This is the highest number of IDF-confirmed airstrikes in Lebanon in a 24-hour period since the ceasefire went into effect on April 16. The IDF stated that it targeted Hezbollah command centers, an unspecified launcher, a weapons depot, fighters, and other Hezbollah military sites.[26]
Other Axis of Resistance Response
Nothing significant to report.
Endnotes
[1] https://www.nytimes.com/2026/05/01/world/middleeast/iran-new-proposal-peace-talks.html [2] https://www.nytimes.com/2026/05/01/world/middleeast/iran-new-proposal-peace-talks.html
[3] https://www.nytimes.com/2026/04/27/world/middleeast/iran-trump-talks-strait-of-hormuz-nuclear.html [4] https://t.me/rahbar_enghelab_ir/313 [5] https://www.axios.com/2026/04/27/iran-us-hormuz-strait-nuclear-talks-proposal-pakistan; https://understandingwar.org/research/middle-east/iran-update-special-report-april-27-2026/ [6] https://understandingwar.org/research/middle-east/iran-update-special-report-april-27-2026/ [7] https://www.nytimes.com/2026/05/01/world/middleeast/iran-new-proposal-peace-talks.html; https://www.reuters.com/world/asia-pacific/iran-offers-strait-deal-trump-dissatisfied-prefers-non-military-path-2026-05-02/ [8] https://t.me/defapress_ir/57831 [9] https://t.me/defapress_ir/57820; https://x.com/N12News/status/2050521251827876252?s=20; https://www.france24.com/en/live-news/20260502-iran-military-official-says-renewed-war-with-us-likely
[10] https://www.bloomberg.com/news/articles/2026-05-02/iran-juggles-oil-cuts-and-storage-strain-to-resist-us-blockade [11] https://nypost.com/2026/04/27/world-news/iran-on-brink-of-irreversible-damage-to-oil-fields-as-storage-runs-out/ [12] https://www.axios.com/2026/05/01/us-blockade-oman-cost-iran-5-million?stream=top [13] https://understandingwar.org/research/middle-east/iran-update-special-report-may-1-2026/; https://ofac.treasury.gov/media/935556/download?inline; https://home.treasury.gov/news/press-releases/sb0483; https://www.state.gov/releases/office-of-the-spokesperson/2026/05/u-s-sanctions-tighten-grip-on-iran-china-oil-trade/; https://home.treasury.gov/news/press-releases/sb0477 [14] https://t.me/mmirleb/15682 [15] https://apnews.com/article/hezbollah-israel-drones-fiber-optic-war-00cd07852f49ade04ed0a6fde505d987 [16] https://apnews.com/article/hezbollah-israel-drones-fiber-optic-war-00cd07852f49ade04ed0a6fde505d987 [17] https://www.reuters.com/world/middle-east/lebanons-hezbollah-what-weapons-does-it-have-2023-10-30/ ; https://aawsat dot com/شؤون-إقليمية/5198751-تقديرات-إسرائيلية-عن-إعادة-بناء-حزب-الله-قدراته-العسكرية ; https://www.ynetnews dot com/article/hyobzilreg ; https://x.com/idfonline/status/1930753541846487369 ; https://x.com/levantupdates/status/2050594994629562372 [18] https://www.ynetnews dot com/article/byujmvmabg#google_vignette [19][19] https://x.com/CENTCOM/status/2050568285825933750?s=20 [20] https://t.me/mmirleb/15668 ; https://t.me/mmirleb/15672 ; https://t.me/mmirleb/15673 [21] https://t.me/mmirleb/15668 ; https://t.me/mmirleb/15672 ; https://t.me/mmirleb/15673 ; https://t.me/mmirleb/15678 [22] https://t.me/mmirleb/15668 ; https://t.me/mmirleb/15672 ; https://t.me/mmirleb/15673 ; https://alquds dot com/en/posts/142445 ; https://www.washingtonjewishweek.com/idf-fighting-against-hezbollah-in-lebanon-ongoing/ [23] https://www.wsj.com/world/middle-east/hezbollah-israel-fpv-drones-970c510f [24] https://t.me/moriahdoron/30529 ; https://t.me/mmirleb/15678 ; https://x.com/idfonline/status/2050541553077112860 [25] https://x.com/idfonline/status/2050620211682775440 [26] https://x.com/idfonline/status/2050620211682775440 ; https://x.com/idfonline/status/2050626390194540901
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