Although the United States and Iran reportedly made progress during their first round of talks in Switzerland, the Islamabad Memorandum of Understanding (MoU) remains fragile.
The remainder of the 60-day negotiating period is likely to be turbulent. Further military threats from US President Donald Trump and Israeli efforts to sabotage US-Iran diplomacy in Lebanon, the main regional flashpoint, could complicate the path forward.
What the “Islamabad MoU” ultimately produces remains uncertain. Yet many observers anticipate that the conflict and subsequent negotiations could accelerate the emergence of a new regional order in the Middle East.
While the war has reshaped perceptions of power, vulnerability, and deterrence, the fundamental drivers of Tehran’s foreign policy are unlikely to change. If anything, Iran may emerge from this period with greater confidence in the effectiveness of its deterrence capabilities.
Throughout the conflict, Iran demonstrated its capacity to rapidly regionalise and internationalise the war, imposing significant costs on its adversaries.
Actions such as closing the Strait of Hormuz and launching missiles and drones toward Gulf Cooperation Council (GCC) states – countries that occupy pivotal positions in the global economy – underscored Tehran’s ability to project pressure well beyond its borders even when under intense attack by the Americans and Israelis.
Looking ahead, the Strait of Hormuz is poised to become an even more central pillar of Tehran’s deterrence strategy, potentially emboldening Iran and enhancing its leverage in future confrontations.
“Knowing that it can control the Strait of Hormuz, and knowing that the world knows it, could boost Iran’s confidence and lessen the need for kinetic solutions,” noted Borzou Daragahi, a longtime Middle East correspondent and founder of Badlands (a newsletter and podcast about global affairs), in an interview with The New Arab.
“Every sort of escalation or increased tension that we’re going to see with the United States is likely to drag the Strait of Hormuz into the picture from now on for the foreseeable future,” Dr Aniseh Bassiri Tabrizi, a senior analyst at Control Risks and an Associate Fellow at Chatham House, told TNA.
Diplomacy with Gulf Arab neighbours
Alongside Pakistan and Turkey, several GCC states, notably Qatar and Saudi Arabia, played important diplomatic roles in facilitating the “Islamabad MoU” between Washington and Tehran.
Assuming the agreement yields tangible results, Iran’s relationships with the six GCC members are likely to evolve unevenly in the post-conflict period.
Broadly speaking, however, the Gulf Arab monarchies appear committed to improving ties with Tehran, prioritising regional stability and economic development and diversification over confrontation.
At the same time, Iran’s attacks on Gulf targets during the US-Israeli war are likely to deepen suspicions of the Islamic Republic among both GCC officials and average citizens, underscoring the limits of any potential for rapprochement in the foreseeable future.
Having “functional relationships” with some GCC members serves Iranian interests, explained Dr Tabrizi. She added that “there will be an attempt to restore some of the relationships that have been broken during the war, and we already see some of that happening with some of the Gulf countries”.
Describing a “balance between active animosity and limited cooperation” that Tehran must strike with its neighbours, Dr Shireen Hunter, an honorary fellow at the Center for Muslim-Christian Understanding at Georgetown University who served as an Iranian diplomat before 1979, told TNA that “Iran would need to mend some fences, which will not be easy and try to reassure its regional partners that it seeks good relations with them”.
Nonetheless, problems in Iran’s relationships with Bahrain and the United Arab Emirates (UAE) are unlikely to improve too quickly. Pointing to Manama and Abu Dhabi’s relationships with Israel, Dr Hunter noted that the Islamic Republic may seek revenge on these two countries.
Despite Iran’s sense that it has “won” the war, the overall situation remains “fragile”, and therefore Tehran should “guard against too much bravado,” she told TNA.
A central question emerging from the conflict is whether (and/or to what degree) the GCC members will move to lessen their reliance on the United States as a security guarantor.
Despite US Secretary of State Marco Rubio’s efforts to reassure Gulf leaders of Washington’s enduring commitment to the sub-region, the war has compelled many policymakers in Gulf Arab states to re-evaluate the credibility and utility of the American security umbrella. Any meaningful shift toward greater Gulf strategic autonomy would carry profound implications for the future of the Middle East’s security order.
“Iran’s neighbours have now seen that Iran can inflict significant damage on them and that the US security umbrella has its limits. Iran showed that if it were to go down, it would bring others down with it. So, an optimistic scenario is that both sides would try to work out some kind of understanding with Iran rather than asking the US, Israel, or some other state to solve their Iran problem,” Dr Hunter told TNA.
“Meanwhile, Iran must not behave in an arrogant and vengeful manner,” she added.
The domestic picture
Although the Islamic Revolutionary Guard Corps (IRGC) will probably emerge from recent developments with greater political influence, governing the country presents challenges very different from those of security and warfare.
Iran’s leadership is likely to recognise that a return to the hardline tactics of the past would be counterproductive, particularly given the social and cultural changes that have transformed Iranian society over recent decades, noted Dr Hunter, who explained that efforts to revive revolutionary themes such as Shia martyrdom may continue, but their mobilising power appears diminished.
Some prominent figures within the establishment, including Mohammad Bagher Ghalibaf, have at times sought to project a more pragmatic and modernising image, leading Dr Hunter to suggest that opposition groups not explicitly advocating regime change may not face a dramatic escalation in repression.
Moreover, Iran’s need for economic relief and international engagement creates incentives to maintain at least the appearance of moderation. At the same time, significant divisions within the post-Ali Khamenei leadership make definitive predictions difficult.
More broadly, describing today’s Iran as an outright “IRGC state” overstates the extent of recent changes, according to Dr Tabrizi. Although security officials occupy a larger share of positions within the political system, there has not been a decisive transformation of the state’s character, at least not yet.
Backing up this argument that Iran should not be categorised as an “IRGC state”, Dr Juan Cole, the Richard P. Mitchell Collegiate Professor of History at the University of Michigan, told TNA that “it is not clear that the IRGC is setting policy, otherwise there would likely be no negotiations with the US”.
Additionally, despite evidence of the IRGC playing a greater role domestically, “it appears that the ruling council of civilians formed after Khamenei’s death is able to steer foreign policy, with the backing of [Supreme] Leader Mojtaba Khamenei”.
Over time, absent a major external threat, the system may gradually soften, even if it falls far short of meaningful political pluralism, according to Daragahi, who added that the more immediate source of hardline policies may be the judiciary, where conservative clerics remain relatively insulated from the social changes affecting much of the country. “They’re the ones pursuing this orgy of death penalty cases,” he told TNA.
Dr Tabrizi said that a reduction in external pressures could allow the government to redirect greater attention toward domestic opposition, potentially increasing repression once wartime priorities recede.
Economic challenges are also likely to persist. Although negotiations with Washington could provide short-term relief and ease some immediate pressures, Dr Tabrizi believes that there is no reason to expect the Islamic Republic’s leadership to be prepared to undertake the structural reforms necessary to address Iran’s deeper economic problems.
In her opinion, the availability of external economic incentives may reduce the urgency for more fundamental change, leaving many of the country’s longstanding challenges unresolved.
Continuing amid change
How, when, and in what ways the US-Israeli war on Iran ultimately marks the beginning of a “new order” in the Middle East all remain open questions.
However, it is clear that the conflict has strengthened Tehran’s confidence in its deterrence capabilities without fundamentally changing the strategic assumptions that have guided the Islamic Republic for many years.
Iran is likely to continue investing in the tools and partnerships that it believes served it well during the war while simultaneously seeking to reduce its isolation through diplomacy with Gulf Arab states and, potentially, the United States.
The decisive variable is not whether Iran has changed, but whether the diplomatic opening created by the “Islamabad MoU” can endure and lead to some form of US-Iran détente.
If it does, a more stable regional equilibrium may emerge. If it fails, the same deterrence dynamics and unresolved rivalries that fuelled the recent conflict could quickly push the Middle East back toward war.
“Iran’s civilian political leadership clearly wishes to end the country’s isolation and break through the attempts to contain it regionally, and to ensure that it isn’t devastated by periodic Israeli bombing campaigns on the model of Gaza and Lebanon. It is therefore seeking a new relationship with the United States and the GCC nations and an end to sanctions,” explained Dr Cole.
“Because of the US midterms and the newly demonstrated vulnerability of the Gulf to Iranian disruption, this initiative appears to be falling on fertile ground,” he optimistically concluded.
For now, at this early stage of the 60-day period for US-Iran talks, the contours of any new regional order remain unclear as diplomacy and deterrence advance side by side in the Middle East’s evolving geopolitical landscape.
Giorgio Cafiero is the CEO of Gulf State Analytics
Follow him on X: @GiorgioCafiero
Edited by Charlie Hoyle
