Iran Update Special Report, May 21, 2026
Excerpts
Iran continues to attempt to build support for its protection racket in the Persian Gulf, in which vessels must pay, coordinate with, or receive permission from Iran's preferred mechanism to transit the Strait of Hormuz in order to avoid attacks from Iranian forces. Iranian Ambassador to France Mohammad Amin Nejad told Bloomberg on May 21 that Iran and Oman are discussing a permanent toll system to formalize control over maritime traffic through the strait.
Iranian officials and state media also reported that commercial vessels coordinated with IRGC Navy forces to transit the strait, while IRGC framed this coordination as necessary for safe passage.
US Secretary of State Marco Rubio stated on May 21 that an Iranian toll system would be unacceptable and “would make a diplomatic deal unfeasible,” which shows that Iran's Strait demands remain a major obstacle to any US-Iran agreement.
ISW-CTP previously assessed that allowing Iran to continue enforcing protocols would be detrimental to US and international commercial interests, as it would mean Iran could prevent ships from traversing the strait anytime it wants.
Iran is continuing to use the ceasefire period to reconstitute its drone and missile program. Sources familiar with US intelligence assessments on Iranian reconstitution told CNN on May 21 that Iran will likely be able to reconstitute damage to Iran's defense industrial base “in a matter of months, not years,” which is “much faster” than the US intelligence community estimated.
This information does not clarify which elements of the defense industrial base or how specific reconstitution would result in changes to reconstitution timelines, which makes the information difficult to judge on its own merits. These timelines are impossible to evaluate without answering such questions, and the assumptions underlying these timelines should be rigorously interrogated, therefore. The officials partially attribute this to some of Iran's defense industrial base remaining intact.
Iran has reportedly been replacing missile sites, launchers, and production sites destroyed during the airstrikes.
It is unclear what constitutes a ”production site” in this context. A production site could theoretically range from an entire factory complex (which would need to be rebuilt if destroyed) to a single piece of complex but rapidly replaceable machinery. The lack of clarification also makes this evaluation difficult to judge on its own merits. Iran still has 50 percent of its drone capabilities, which amounts to thousands of drones, as well as a “large percentage” of Iran's coastal defense cruise missile stockpile left, according to these officials.
Iran's drone program is far more difficult to degrade for long periods of time compared to the ballistic missile program. The drone program relies on less complex and more easily-produced systems compared to the ballistic missile program, which requires huge facilities with extremely specialized equipment (like planetary mixers for solid fuel, for example). The officials observed that Iran has around two-thirds of its missile launchers after digging out many during the ceasefire.
CNN noted that this estimation may still include buried launchers, however.
The People's Republic of China (PRC) and Russia are helping Iran reconstitute its drone and missile program. The PRC has sent missile components, according to US officials familiar with intelligence assessments, speaking to CNN.
There is no evidence that these missile components reached Iran. CNN added that the US naval blockade on Iranian ports may have hindered Russian and Chinese efforts to support Iran's reconstitution.
US Central Command (CENTCOM) reported that US forces redirected 94 vessels and disabled four others since the start of the blockade on Iranian ports on April 13.
US forces previously seized the Iranian-flagged Touska in the Gulf of Oman on April 19, and its cargo, which was described as “conditional contraband,” including electronic components, computer systems, machinery, and power generation equipment.
Unspecified security sources told Reuters that the Touska was likely transporting dual-use items from the PRC to Iran because the vessel had done so previously.
The PRC has sent multiple shipments of missile fuel precursors to support Iranian missile reconstitution efforts following the June 2025 Israel-Iran War, even during the most recent war.
US officials told the New York Times on May 9 that Russia is shipping drone components to Iran through the Caspian Sea to help rebuild Iranian drone capabilities as well.
https://understandingwar.org/research/middle-east/iran-update-special-report-may-21-2026/
