Robert Kagan writes:

For years, Iran confronted a balance of power in the Middle East that tilted against it. The region was dominated by a hostile American superpower, a nuclear-armed and militarily superior Israel, and significant local actors—Egypt, Saudi Arabia, the United Arab Emirates—that were strategically and economically aligned with the United States.

Today finds Iran in entirely new circumstances. It has gone head-to-head with the superpower and Israel, withstood a pounding from their most advanced weapons, and more than survived. As a result, Iran has, with American help, completely reconfigured the power structure of the Middle East and the Persian Gulf. The dominant power in the region going forward will be Iran, not the U.S. or Israel. Neighboring countries are already making their adjustments to this new reality. More distant powers will too. For years, the world has been dealing with an Iran constrained. It will now discover what Iran unleashed looks like.

Iran doesn’t need a deal with the United States. The common assumption that a weak and impoverished Iran would eventually have to make some accommodation to American power, open the Strait of Hormuz, and set about tending to its badly damaged economy has proved mistaken. The Islamic Republic has rarely appeared weaker or more vulnerable than it has over the past two years. Last February, President Trump renewed his “maximum pressure” campaign of international sanctions, which severely damaged Iran’s already-weak economy and cut billions of dollars in state revenues. Israel and the United States then launched the 12-day war that June to destroy Iranian nuclear facilities. The war significantly damaged Iran’s program and revealed just how vulnerable the country was to Israeli and American strikes. Then, in February, the United States and Israel launched the most recent war with the killing of the regime’s supreme leader and the great majority of its senior officials, followed by more than five weeks of unremitting attacks on Iranian military capabilities.

Yet through all of this, the regime has survived and made no concessions. On the contrary, Iran exposed America’s Achilles’ heel: the vulnerability of Iran’s neighbors. A major turning point came in mid-March, when Israel attacked Iran’s South Pars gas field, and Iran retaliated against Qatar’s Ras Laffan complex, the world’s largest liquefied-natural-gas facility. The attack showed that although Iran obviously could not defeat the United States in an air war, Iranian missiles and drones could inflict enough damage on the oil-and-gas infrastructure of the Gulf to plunge the world into a prolonged economic crisis. The Gulf States understood this immediately, and so did Trump. He halted attacks on Iranian energy targets, ordered a reluctant Israel to do the same, and soon brought the larger campaign to a stop without extracting a single Iranian concession. Ever since, and despite many threats, Trump has not once ordered another strike against Iranian energy infrastructure.

This alone was enough to alter the balance of leverage between Iran and the United States. From April through last month, Trump repeatedly threatened to launch another massive attack against Iran. Each time, Iran threatened retaliation, Gulf States warned of the consequences, and Trump backed off. By his third or fourth bluff, Tehran had reason to conclude that the United States was no longer prepared to follow Iran up the ladder of escalation. Trump made this clear when he noted in mid-June that continuing the war would lead to “economic catastrophe,” possibly even a “depression,” and that he did not want to become President Herbert Hoover. Ever since, Trump has been trying, with notable desperation, to end the conflict. [Continue reading…]