**France's recent expulsion of two Iranian diplomats in August 2026, in direct retaliation for Iran's persona non grata declarations against French embassy staff over alleged interference, stands as the dominant recent catalyst for trader sentiment on further expulsions.** This tit-for-tat episode followed Iran's July detention and accusations against French diplomats under the Vienna Convention, prompting Paris to act formally while Tehran labeled the response unjustifiable and damaging to bilateral ties. Earlier 2026 actions—including Lebanon's March persona non grata order against its ambassador-designate (later partially walked back via civilian residency extension), plus prior U.S., Saudi, Argentine, and Kuwaiti moves—establish a pattern of countries citing security breaches, diplomatic violations, or regional proxy concerns. Ongoing strains with Western and Gulf states over interference allegations, sanctions pressure, and Middle East conflicts sustain elevated baseline risk, though the absence of major new catalysts since mid-August has moderated near-term probabilities. Traders monitor official announcements, Vienna Convention disputes, and any escalation tied to broader Iran policy or upcoming diplomatic summits for resolution triggers.