Iran this week is burying its second Supreme Leader of the year, and it's doing so amid a war footing that has so far been only suspended, a successor who has yet to appear in public since the death of his predecessor, Ayatollah Ali Khamenei, four months ago, and an international oil market that for four months has vacillated between panic and relief, depending on the news from Tehran.

Funeral ceremonies start in Tehran on July 4, and then are held in the holy city of Qom on July 7, and in Mashhad on July 9, where the shrine of Imam Reza is located, one of the most sacred places of Shia Islam. Iranian state media originally planned the ceremony for early March, soon after Khamenei's death, but postponed it because they felt a mass event in wartime was too risky. Four months between death and burial is quite a long time for a figure whose religious status requires a quick burial and it reflects Tehran's own shaky sense of control this year.

Khamenei, who has governed Iran since 1989, when Ayatollah Ruhollah Khomeini, the founder of the revolution, died, was killed at his home in Tehran at 8:10 a.m. local time on Feb. 28 in the first of a series of attacks that would eventually reorder the Gulf energy market, wobble economies as far away as Bangladesh and Sri Lanka, and bring diplomats from Washington to Doha to Beijing. Around 21 hours later state broadcaster IRIB confirmed his death. He was 86.

The Iranian security forces are burdened with history. At least eight people were killed and about 11,000 injured in the rush for the open casket that day, in June 1989, when Khomeini was buried, as the mourners scrambled over his casket during the funeral, in 100-degree heat, causing his white-shrouded body to tumble into the crowd. Just over 30 years later, over 56 individuals ended up losing their lives in a stampede during commemorations for the commander of the Revolutionary Guard, Qassem Soleimani. Iranian authorities have ordered the closure of the Tehran Grand Bazaar, closed down large parts of the streets of the capital and restricted the airspace above the city for the duration of the ceremonies as estimates put the number of people attending Khamenei's funeral at as many as 20 to 35 million. Add to this the fact that Israel closely monitored and targeted senior Iranian commanders during the war, in part because of their public events, so that every open-air event this year is a true security risk and not simply a formal ceremony.

But the big question is whether Khamenei's successor to the throne, who is his own son, will appear at the event. It is not clear what his condition is, but he has not been seen in public since March 8 when Mojtaba Khamenei was designated the new Supreme Leader of the Islamic Republic following his father's death in the strike. His wife, Zahra Haddad-Adel, the daughter of a former Iranian parliament speaker, was also killed in the same attack; her funeral was held in Tehran just this past Thursday, days before her father-in-law's. Before his own people is no insignificant logistics for a theocracy that has been in charge of a domestic security crackdown for six months since nationwide protests against clerical rule.

The guests from abroad were read like a list of countries that still wish to maintain ties with Tehran amid the war. The Pakistani Prime Minister Shehbaz Sharif and former President Asif Ali Zardari are both in attendance, as Pakistan is making a Pakistani swing through Iran and Turkey this week. China will dispatch vice chairman of its National People's Congress standing committee He Wei as special envoy of Xi Jinping. Former president Dmitry Medvedev will head Russia's delegation on behalf of Vladimir Putin. Bangladesh, Georgia and Cuba have had senior representation and a total of more than 30 countries are expected to send delegations, according to Iranian officials.

India's involvement is measured but not showy, and this is a sign in itself. The Indian delegation is meant to be a mid-level one, with Bihar Governor Lieutenant General Syed Ata Hasnain and Minister of State for External Affairs Pabitra Margherita rather than their more senior counterparts, since that is how India has acted throughout the year: it wants Iranian goodwill for the Chabahar port project and for the approximately half of its Middle Eastern crude that passes through the Gulf, while also maintaining its growing strategic and defense ties with the United States and Israel. The presence of the state governor and a junior minister not external affairs minister or a more senior minister enable India to be present and be seen to be honouring an important regional relationship without elevating the funeral to a full state occasion on the Indian side.

Beneath the diplomacy and the choreography of grieving lie an economic narrative that has already reshaped energy markets for one fourth of this year. The closing of the Strait of Hormuz, which was done by Iran on March 4 in response to the war, resulted in the biggest supply disruption in the history of the oil market, as the International Energy Agency (IEA) put it. Brent crude, which was below $72 a barrel before the onset of the war, surged past $120 a barrel in two weeks, as about one-fifth of the world's seaborne oil and a similar proportion of liquefied natural gas became trapped on the other side of the closed strait. The shipping lanes at Hormuz are vital to the G.C.C. states, which depend on them for most of their food imports and all of their energy exports, and analysts said there was a real grocery crisis, with prices for staple goods rising by as much as 120 percent in some places in the region in weeks.

There was an immediate and worldwide pass-through to ordinary consumers. The price of gasoline in the U.S. surged over $4 a gallon for the first time since 2023, and for a brief period, even California counties were seen to be exceeding $6 per gallon. In North America, the price of jet fuel spiked some 95 percent at the height of the crisis, forcing air carriers to increase baggage fees and directly leading to the demise of airline Spirit Airlines in May. However, in India the government has reduced excise duty on petrol and diesel by 10 rupees a litre to ease consumers as it raised export duty on diesel and aviation fuel to maintain sufficient supply at home and Indian refiners were increasingly looking to Russian crude to compensate for disrupted Gulf supply. About 60 per cent of India's demand for cooking gas is met from imports, which often pass through the strait of Hormuz, and LPG is one of the first commodities to have begun becoming visibly short with queues at distribution centres in some States. The broader area did worse: Colombo is implementing a four-day working week, and Bangladesh's central bank has sounded recession alerts, as the more price-sensitive economies with smaller buffers took disproportionate hits from the events of Bangladesh, Pakistan, Sri Lanka, Vietnam and Thailand.

Crude prices backslid much of that surge as the interim ceasefire agreed in Doha began to take effect in April and May and by mid-June Brent had been pulled back toward the high 70s on optimism that the strait would fully reopen. That respite has not been lasting. Brent bounced back slightly to about $73 a barrel last month after American and Iranian troops traded strikes for the second time in as many weeks after attacks on two commercial ships were still making the rounds in Hormuz. Energy analysts have been forthright about the narrow margins for error: The latest assessment from Vanda Insights this month said the market has been playing a game of cat-and-mouse with a best-case scenario for the reopening of the shipping lanes at Hormuz and is at risk if there is renewed friction between Washington and Tehran. The irony is compounded by the Financial Times investigation earlier this year into three specific wagers against oil prices, totaling $2.3 billion, which were made just minutes before some of America's biggest policy decisions on the war and serious enough to warrant a formal insider-trading probe.

All this now runs head-on into the funeral calendar. The 60-day negotiating window agreed upon by both sides in June, to address the more difficult issues of Iran's nuclear program and the longer-term future of shipping using the strait of Hormuz, has been placed temporarily on hold for the week of the funeral, while both Washington and Tehran privately claim progress is being made outside the spotlight. Discussions are likely to resume in Doha after the burial, which is scheduled to end on July 9, when U.S. special envoy Steve Witkoff and Jared Kushner will remain at the helm of the American delegation. It is the days immediately after Mashhad that are now being viewed as the true test whether Iran's political transition will go smoothly enough to allow those negotiations to continue toward something more substantive, or whether a cloudy succession and an outwardly discontented public within Iran will drag the nation back toward the turmoil that forced a funeral in the first place.

The ceremonies in Tehran, Qom and Mashhad are not just a religious ritual for a region that's been a year taking the brunt of the price of stranded tankers, rationed cooking gas and grounded flights. If the Islamic Republic, without the man who for 37 years set the course for its own existence, can still put on a show of coherency in conducting its own funeral, and whether the world's oil markets can ever stop treating any news alert out of Iran as a five-alarm event.