Iran’s supreme leader faces his defining moment

For decades Iran’s supreme leader has sought to balance his ideological hostility towards the US and Israel with a pragmatic desire to avoid all-out war.

But now that US President Donald Trump has joined Israeli Prime Minister Benjamin Netanyahu in taking the fight to the Islamic republic, Ayatollah Ali Khamenei faces the most consequential decision of his nearly 40 years in power. Does he look for a diplomatic compromise with Trump, seek to escalate or try to keep the conflict contained to Israel?

After the US president ordered the bombing of Iran’s main nuclear sites — Fordow, Natanz and Isfahan — in the early hours of Sunday, the republic’s supreme leader will want to show that the regime, battered and bloodied, is still able to put up a fight and will not be cowed into submission.

But regime insiders suggested that Khamenei would not escalate against the US and risk a harsher response that wreaks more destruction on the republic. Instead, they say, Iran’s prime response will be intensifying attacks on Israel.

“Let Trump be happy and feel victorious, we are not going to enter into a big war with the US,” one regime insider said. “The US only attacked three sites. If they wished to go for a big war, they would have destroyed more places, but they didn’t.”

US vice-president JD Vance on Sunday insisted that the US was “not at war with Iran”, but with its nuclear programme. “We have no interest in a protracted conflict. We have no interest in boots on the ground,” he told NBC, adding that the Trump administration does not seek regime change.

The Iranian regime will, however, keep firing at Israel — as it did hours after the US attacks and not submit to an unconditional ceasefire. Iran’s Revolutionary Guard said it fired 40 “new generations” missiles at Israel hours after the US strikes. Israel said more than 20 missiles were fired, but no deaths reported.

“When Iran accepted a ceasefire in the 1988 Iraq war, commanders said they had run out of ammunition. Now commanders say let’s firmly resist and hit back. Iran will not ask for a ceasefire under any circumstances,” the regime insider said.

A second regime insider said Iran had no other choice but to deliver “a crushing response to the US” — but would do so through attacks on Israel, which triggered the war with waves of strikes on the Islamic republic last week.

“It’s natural for Iran to intensify its attacks on Israel because it was Netanyahu who dragged the US into war with Iran,” the insider said.

He added that closing the Strait of Hormuz — through which more than a quarter of the world’s seaborne crude passes — could be considered if the conflict escalates.

Analysts have warned there was a risk that the regime could rush to develop a nuclear bomb in an attempt to restore its deterrent and that it had managed to divert some of its stockpile of uranium enriched close to weapons grade from Fordow and Natanz to secret locations.

The first regime insider said this was not yet an option being considered by the leadership.

“We should have been very naive to keep our enriched uranium in those sites — the enriched uranium is untouched now,” the insider said. “But this doesn’t change anything because we have no plan to use it. Iran has not and will not seek nuclear weapons.”

On Sunday, Iranian foreign minister Abbas Araghchi said Tehran had “a wide range of options available” and was calculating its response, while warning that the US has “crossed a very big red line”.

Iran’s Guards said that the US had “placed itself on the frontline of the military aggression” by attacking the country’s peaceful nuclear facilities.

Iranian officials have warned in recent weeks that if the US attacked Iran, the Islamic republic could respond by targeting American bases and assets in the region, as well energy facilities in the Gulf.

Khamenei warned last week that Trump “should know that any US military engagement will undoubtedly result in irreparable damage”.

Sanam Vakil, Middle East director at Chatham House, said Khamenei could revert to his strategy of seeking to “escalate to de-escalate” — strike out, but in a way that reduces the risk of a more ferocious US response and leaves the door to diplomacy open.

“They are more boxed in than they have ever been and they need to find an off-ramp,” Vakil said. “With the few options before them, this is the only scenario that makes sense that provides the regime a lifeline.”

Iran could for example strike a base used by some of the 2,500 American troops in neighbouring Iraq, she said. Such an attack, with advance warning, would cause minimal damage.

It is the tactic Tehran used after Trump ordered the assassination of Qassem Soleimani, Iran’s most powerful military commander, while he was at Baghdad airport in 2020.

The regime responded by firing a large missile barrage at two bases in Iraq hosting American troops. It was the biggest attack against a US base in decades, but Tehran used back channels to telegraph the assault was coming, and with no deaths reported, and both sides seeking to avoid a full-blown war, they pulled back from the brink.

The US’s strikes on Sunday were on a far more severe scale: the first ever direct American attack on the republic coming at a time when it is facing an existential threat and at its most vulnerable point since the 1979 revolution brought in the theocratic system.

Even before the US attack, Israel’s strikes had already decimated the top ranks of Iran’s military command and destroyed many of its missile launchers and plants.

It is why Emile Hokayem, at the International Institute for Strategic Studies, said “the whole argument about prioritising regime survival needs context and nuance”.

“Khamenei’s calculus has disastrously failed and his caution will be seen by many inside the system as part of Iran’s debacle,” Hokayem said. “It’s still possible that this new political dynamic in Tehran may lead to a readiness to go hard in the neighbourhood, with more escalation — it could blow up.”

If Iran chose to launch attacks across the Gulf, it could use its arsenal of shorter range missiles, which are more accurate and, given the distances, would leave defences in the Gulf with less reaction time.

It could also seek to draw in the regional militants it backs that are part of the so-called axis of resistance.

But its most powerful and important proxy, Hizbollah, was severely depleted by Israel’s bombardment of Lebanon last year.

Tehran could attempt to mobilise Iranian-backed Shia militants in Iraq, which have in the past attacked US bases, facilities and troops in that country.

Houthi rebels in Yemen could also respond and have already threatened to attack US naval vessels in the Gulf, as they have done previously.

The militant movement has already severely disrupted traffic through the Red Sea since launching attacks on merchant vessels in the vital trade maritime trade route in the wake of Hamas’s October 7 2023 attack on Israel. The Houthis withstood an intense month-long US bombing campaign that ended in May when Trump abruptly called a halt to the attacks, while praising the rebels’ “capacity to withstand punishment”.

But Vakil said a critical factor would be what Netanyahu does. He upended Trump’s attempt at negotiations with Iran to secure an agreement to resolve the stand-off with Tehran over its expansive nuclear programme and has succeeded in his goal to draw the US into combat.

“It’s unclear if Trump has the influence over Netanyahu and that’s important in what happens next,” she said.

And if Trump looks to return to diplomacy, the regime’s deep distrust of the US, and European powers, has been exacerbated. For weeks, the main hurdle to a deal was Tehran’s refusal to give up its right to enrich uranium as Trump demanded. The question is whether the US’s bombing of Iran’s main enrichment facilities changes Khamenei’s calculus.

Trump, who last week called for Iran’s “unconditional surrender”, demanded on Saturday night that Tehran “make peace” or face more intense attacks. Iran has vowed not to capitulate to US pressure.

“Last week, we were in negotiations with the US when Israel decided to blow up that diplomacy,” Araghchi said in a post on X. “This week, we held talks with the E3/EU [the UK, France and Germany] when the US decided to blow up that diplomacy. What conclusion would you draw?”