Iran

By Lady Olga Maitland

Iranian insider Dr Mehrdad Khonsari, Senior Consultant at the Iranian Centre for Policy Studies, said to me this week: 'The fact is Donald Trump does not want to use military force, and sanctions will have no immediate effect. What is interesting is that the real block to a deal is the behind-the-scenes struggle between the hard liners and the pragmatists.'

A separate source with close IRGC links agreed, judging that hardliners currently control the narrative with Washington, though this could change.

For now, the hardliners retain the firmer grip on the machinery of power. The Revolutionary Guard establishment, acting in the name of Supreme Leader Mojtaba Khamenei, has installed new hardline appointments across the security and paramilitary apparatus. Hossein Taeb, a hardline former IRGC intelligence chief, has been brought back to head the Basij.

Yet the pragmatists, led by President Pezeshkian, are pushing in the opposite direction. He has publicly acknowledged the severe economic damage caused by the war and called for it to end.

Away from the headlines, Iranian officials continue to signal willingness to negotiate if Washington eases the pressure. Reuters reported on 28 August that Tehran is considering modifications to its position on reopening the Strait of Hormuz, and that diplomatic efforts via Qatar and Pakistan are ongoing.

This matters, as it suggests the pragmatic camp has not been eliminated, and that a substantial part of the establishment believes Iran cannot indefinitely sustain the economic and military pressure. The internal struggle within Tehran is real, and it is intensifying.

Can 'Economic D-Day Sanctions' Work?

Opinion is divided; most see them working only in combination with other pressure. Washington views Iran's economy as extremely weak, and is also pressing allies to choose between doing business with Tehran and retaining access to the US financial system and the dollar, targeting China, the UAE and Turkey, among others.

Sanctions will likely damage the economy significantly, but economic pain and political capitulation are not the same thing. The coming weeks look critical: Iran's economy will continue to deteriorate, and the real test is whether its leadership judges that the cost of continuing the war now outweighs the political cost of accepting a deal with Washington.

As my Iran insider put it: 'Trump wants to end the war. The final element is that Trump has said he wants to invest in Iranian oil and gas. My instinct is that the next three months will be interesting.'