In December 2004, Jordan’s King Abdullah raised concerns about the rise of a Shiite crescent that could potentially destabilize Sunni-majority countries. At first, many analysts dismissed his warnings, but they turned out to be quite accurate as events unfolded over the next two decades.
This Shiite Crescent, with Iran at its center, included Baathist Syria, Hezbollah in Lebanon, Hamas from Palestine, the Houthis in Yemen, and various Iraqi militias. However, today, that once-unified front appears to have disintegrated.
Last year, Iran’s influence saw a drastic change. Following an Israeli attack in September 2024 that killed prominent Hezbollah leader Hassan Nasrallah and others, Israel launched a significant invasion of Lebanon in October, resulting in a ceasefire the following month and a noticeable weakening of Hezbollah.
In Syria, the Iranian-backed Assad regime fell apart in December after a lengthy civil war, leading to new governance that reduced Iran’s long-standing presence in the nation.
Moreover, the ongoing conflict between Israel and Hamas, backed by Iran, has resulted in a ceasefire that has further diminished Hamas’s power. It seems unlikely they will be able to fully regain control in the region.
Israel’s 12-day offensive targeting Iran’s military assets, with support from U.S. airpower, also exposed Iran’s inability to handle Israeli actions in its airspace. While Iran might have expected backing from allies like Russia and China, it appears those expectations were unmet, throwing its military into chaos.
It’s true that the Houthis in Yemen are still actively operating, but their impact seems limited; they occasionally cause disruptions to ships in the Red Sea and Israeli interests, yet they don’t pose a major threat to the regional states, except perhaps southern Yemen. Iraqi militias also seem confined within Iraq and lack significant offensive capabilities beyond their borders.
This year doesn’t seem to have favored the Muslim population in Tehran.
Iran’s economic situation has been precarious for a while. The snapback of sanctions tied to the 2015 nuclear deal, enforced on September 28, only complicates matters further. Earlier projections by the World Bank estimated a meager growth rate of 0.7% for 2026, but due to these recent developments, they now forecast a contraction of 1.7% in GDP for that year, with an even steeper decline of 2.8% expected for 2025.
With its proxy strategy collapsing and its economy faltering, one might think the Iranian regime is on the brink of falling apart. But, well, not necessarily. The ruling mullahs and the Islamic Revolutionary Guard Corps have withstood past uprisings quite effectively. Interestingly, the regime is approaching 50 years since its inception, exceeding many expectations of its critics.
Additionally, Iran does not stand entirely alone. Despite recent struggles, Russia and China maintain trade relationships with Tehran. They opposed the snapback sanctions, arguing that the UK, France, and Germany lacked the authority to impose them. Notably, China purchases about 90% of Iran’s oil but at significantly reduced prices and has helped Iran modernize its infrastructure through barter agreements.
There’s also Iran’s role as a supplier of military hardware to Russia during the Ukraine invasion, with Russia providing arms in return. Iran has employed covert shipping tactics to bypass detection while exporting its goods.
Meanwhile, there’s been talk that India might scale up its oil purchases from Iran, which would be a shift since they halted imports in 2018.
Nonetheless, UN sanctions will likely keep pressuring Iran’s already struggling economy as long as Western powers continue to enforce them. The Trump administration is expected to uphold these sanctions and penalize any violators. Just recently, the U.S. imposed sanctions on several Indian nationals and companies linked to Iranian oil trade, but this might not sufficiently deter India.
Some speculate that Iran could ramp up its nuclear ambitions in light of the renewed sanctions, a sentiment echoed by an Iranian spokesperson. Yet, the recent military confrontations have laid bare and intensified Iran’s vulnerabilities. Pursuing its nuclear aspirations could leave it exposed to further military actions.
The pivotal question remains whether the three European nations behind the sanctions can withstand Iran’s pressure and avoid a deal that allows Iran to continue enriching uranium and furthering its missile programs.
The U.S. might find it useful to draw from Margaret Thatcher’s counsel to George H.W. Bush and urge European nations to prioritize firmness. Decades ago, when President Bush grappled with Saddam Hussein’s invasion of Kuwait, Thatcher advised him not to hesitate. The situation has now flipped, and perhaps that advice could serve as a guiding principle for Europe amid current tensions.
