Iran International
The Iranian year 1403, which ended on March 20, saw the further weakening of major state institutions as Supreme Leader Ali Khamenei tightened his grip over a network of overlapping bodies, some of which he created himself.
Nonetheless, while the weakening of state institutions, including the parliament and the presidency, has largely succeeded, it does not mean Khamenei rules unchallenged.
As the country’s economy sinks deeper into crisis, many challenges come from within his own conservative camp, where critics—often quietly—hold him responsible for the system’s failures, referring to him indirectly as the "political system."
Throughout the year, Iran struggled with a broken economy and the looming threat of political unrest. Gas and electricity shortages have plagued both industries and households for months, while officials warn of an impending water crisis. Meanwhile, the US dollar has doubled in value against the rial. Most Iranians now see Khamenei as the primary figure responsible for these crises.
With the death of former President Ebrahim Raisi in a helicopter crash in May 2024—widely seen as appointed rather than elected—the Islamic Republic’s leader had to find another obedient aide to serve as a silent partner in governing. But the new president proved to be even more obedient than Khamenei expected.
Rescued from disqualification by the Guardian Council at Khamenei’s behest, he has repeatedly acknowledged that he would not be president without the Supreme Leader’s favor. He has gone even further, openly stating that he has no independent plans or platform and will simply implement Khamenei’s vision for the country.
In a recent example, he told parliament that while he initially supported negotiations with the United States over Tehran’s nuclear program, he opposed them as soon as Khamenei dismissed the idea. “It is as simple as that,” he explained.
The Iranian parliament (Majles), shaped by Khamenei and the Guardian Council in its two most recent elections, was engineered to ensure an overwhelming majority of hardline conservatives. The Guardian Council disqualified nearly all moderate and pro-reform candidates as part of what former Majles Speaker Ali Larijani described as "political purification."
Under both Raisi and Pezeshkian, key decisions on critical issues, including the annual budget and contentious matters like the compulsory hijab bill, were made by the heads of the three branches of government or the Supreme Council of National Security, rather than the Majles. Government insiders often criticize the parliament as "illiterate and inefficient."
The Assembly of Experts, tasked with selecting the next Supreme Leader, has been effectively sidelined, as a three-member committee reporting exclusively to Khamenei now secretly vets candidates for his consideration alone.
Meanwhile, the council’s deputy chief, Ahmad Khatami, was stripped of his privileges for violating unwritten rules set by Khamenei.
The Guardian Council's decisions have also been occasionally overturned by Khamenei himself, allowing disqualified candidates such as Mostafa Moein, Mohsen Mehr Alizadeh, and Massoud Pezeshkian to run for president.
The Expediency Council has become so ineffective and paralyzed by intimidation that it has failed to issue a verdict on approving laws meant to improve Iran’s compliance with international regulation against money laundering.
For years, Khamenei has not publicly assigned it any new responsibilities, instead making all key decisions himself.
Until five years ago, when these institutions functioned with a degree of quasi-efficiency, some Western observers described Iran’s system as resembling a democracy. Today, such a characterization is no longer plausible. Iran’s political landscape is now "unique" for all the wrong reasons.
Nowruz is more than just a celebration of renewal, prosperity, and the arrival of spring; it is a cultural cornerstone that has survived centuries of change. Its enduring spirit reflects the resilience of Persian heritage, bridging the past and present while continuing to bring families and communities together.
Nowruz begins at a precise astronomical moment—the Spring Equinox, usually on March 21—when families gather around the traditional haft-seen table, exchanging greetings and gifts to welcome the new year. If the Equinox falls in the second half of March 20, celebrations begin earlier, though the new calendar year officially starts the next day.
Nowruz and the Iranian Calendar
Unlike the lunar-based Islamic calendar, where the year is 1446, the Iranian calendar follows the solar-based Jalali system, introduced in 1079 AD. The first year of the Jalali calendar aligns with Prophet Muhammad’s migration (Hijra), yet its months are named after ancient Persian deities, reflecting Iran’s fusion of Islamic and pre-Islamic traditions.
The lunar-based calendar is around ten days shorter each year than the Iranian calendar year. This sometimes causes an overlap between Nowruz and Shia mourning days or Ramadan. Like last year, Nowruz coincides with Ramadan this month, and the second day of the New Year will be a mourning day for the first Shia saint, Imam Ali. Such coincidences complicate the celebrations for observant Muslims and others in Iran who must be careful not to offend the former by making a show of the festive Nowruz spirit.
Endurance of a pre-Islamic festival
Despite Iran’s Islamification 1,400 years ago and the 1979 Islamic Revolution, Nowruz remains a cherished festival, celebrated not only in Iran but also in neighboring countries including Afghanistan, Turkmenistan, Azerbaijan, and by Kurds in Turkey and Iraq.
Some Iranian clerics and their followers oppose or are lukewarm toward Nowruz due to its pre-Islamic origins and perceived ties to Zoroastrianism. However, the Islamic Republic has never sought to ban the widely celebrated holiday. Instead, it has used state media, mosques, and propaganda organizations to elevate Islamic holidays—including the birthday of Prophet Mohammed, Eid al-Fitr, and Eid al-Adha—seeking to enhance their festive significance.
Folk music group performing at Pasargadae on Nowruz day, March 21, 2023
Ancient Origins: From Persepolis to Today
Nowruz dates back to the Achaemenid Empire (550–330 BC) and likely has roots in ancient agricultural festivals that celebrated the cycle of nature. Some scholars believe it was influenced by the Babylonian spring festival of Akitu, which inspired Persians to establish their own New Year tradition.
Historical evidence suggests that parts of the Persepolis complex, such as the Apadana Palace and the Hall of a Hundred Columns, were constructed for grand Nowruz ceremonies. The famous bas-reliefs of Apadana Palace, depicting people from various regions bringing gifts to the Persian king, may represent Nowruz celebrations at the heart of the empire.
The Haft-Seen: A Table of Symbols
At the heart of Nowruz celebrations in Iran is the haft-seen, a carefully arranged spread on the floor or a table that symbolically embodies light, life, fertility, nature, and prosperity.
The names of at least seven items on the spread must start with the Persian letter “sin”, possibly derived from “sini” (meaning tray), as it was once customary to display them on seven trays. These items include sprouted greens (sabzeh), Coins (sekkeh), Apples (sib), a pudding made from freshly sprouted wheat germ (samanu), sumac (somagh), garlic (sir), hyacinths (sonbol) and vinegar (serkeh).
A mirror and candles (symbols of light), painted eggs (symbol of fertility), goldfish (symbol of life), as well as various sweets and nuts, and a holy book (such as the Quran) are often also placed on the spread.
The family gathers around the spread, and when the Equinox is announced on radio or television, they embrace and exchange well wishes. The head of the family distributes gifts, often crisp new banknotes placed inside the Quran for blessing, while sweets are shared to usher in a sweet and prosperous new year.
Traditionally, people visit the eldest members of their extended families as soon as possible after the new year begins. During the holiday season, they continue visiting other relatives and acquaintances, with each visit expected to be reciprocated.
Traditional Nowruz cuisine
Food is central to Nowruz celebrations, with special dishes symbolizing renewal and abundance. While traditional Nowruz meals once varied widely across regions, they were shaped by local ingredients and culinary traditions.
Since the mid-20th century, however, a fragrant rice dish with fresh herbs (sabzi polo), served with pan-fried fish and a rich green herb omelet (kuku sabzi), has become the most common Nowruz meal. Previously, this combination was mostly popular in the northern Caspian Sea region.
Rice mixed with noodles, served with various meat or chicken-based stews, and ash-e reshteh—a hearty soup made with legumes, herbs, and noodles—are also popular Nowruz dishes. The noodles in these meals are believed to symbolize the unraveling of life’s complexities and a clear path for the year ahead.
At the start of the year in March 2024, Iran was already grappling with a broken economy and the looming threat of political unrest. Regionally, however, it still appeared strong and could plausibly project itself as a serious challenge to US and Israeli interests.
Conflict with Israel
As the year began, Israel was deeply engaged in its war with Iran-backed Hamas in Gaza. Tehran confidently claimed that its regional adversary was stuck in an unwinnable conflict, boasting about its so-called Resistance Front and threatening to escalate against both Israel and US interests. Yemen's Houthis were already disrupting shipping in the Red Sea and launching missiles at Israel.
Houthi attacks on maritime trade which began in November 2023 following a declaration by Iran’s Supreme Leader Ali Khamenei inflicted an estimated $200 billion in losses on the global economy.
Less than a month into the Iranian year, Tehran launched a large-scale missile and drone strike on Israel In April 2024 in response to Israeli attacks on Iranian targets in Syria.
While most projectiles were intercepted with minimal damage, the Islamic Republic framed it as a significant blow against the "Zionist entity." At the time, Tehran appeared strong, seemingly capable of deterring its most determined adversary.
However, the tide began to turn in late July when Hamas leader Ismail Haniyeh was killed in an explosion while staying at a government guesthouse in Tehran.
It remains unclear whether the incident was caused by a planted explosive or an Israeli missile strike, but the ability of Tehran's arch-foe to strike seemingly anywhere was lost on no one.
The assassination would be just one of many, crescendoing with the killing of Hezbollah leaders via their bomb-laden communication devices and culminating in the assassination of its storied leader Hassan Nasrallah.
Political crisis
Before these epochal blow, Iran suffered another major shock in May when hardline President Ebrahim Raisi and his foreign minister died in a mysterious helicopter crash in northwestern Iran.
Many doubted the official explanation of bad weather, which was never conclusively proven, fueling speculation about a high-level internal plot or an Israeli operation.
Raisi had been widely regarded as ineffective, presiding over a rapidly deteriorating economy since taking office in 2021.
In June, Iran held presidential elections, with several key candidates disqualified through a vetting process controlled by Khamenei. Ultimately, Masoud Pezeshkian, a politician with no executive experience, faced hardliner Saeed Jalili in a low-turnout runoff and won.
During his campaign, Pezeshkian made it clear that he had no plans beyond executing Khamenei’s directives.
Some Iranians still hoped for limited reforms and a diplomatic breakthrough to ease US sanctions. However, when Khamenei formally banned negotiations in early February 2025, Pezeshkian pledged loyalty to his decision, disappointing even his Reformist supporters.
Economic crisis
By mid-2024, with Hezbollah and Hamas weakened and Israel growing more confident in striking Iranian military targets, Iran’s economic woes deepened. The rial, which had been around 550,000 per dollar in September, plunged to 900,000 by February and even hit one million by March 18.
The worsening economic picture underscored a government unable to halt a downward spiral. Severe energy shortages crippled both households and industries throughout fall and winter, with the government regularly announcing power shutdowns across the country due to heating and electricity failures.
Iran’s oil exports to China continued through intermediaries and at deep discounts, but the Trump administration escalated sanctions on oil tankers and trading entities following Biden’s late-term crackdown on exports.
Revenues from these limited exports fell far short of meeting the government’s foreign currency needs, especially given Tehran’s ongoing financial commitments to regional proxy groups.
Bleak outlook
Many political insiders in Tehran now say Pezeshkian’s administration may be incapable of addressing the worsening economic crisis. The only potential relief would come from easing US sanctions, but Khamenei has so far resisted Trump’s pressure to make concessions.
It remains unclear whether Washington seeks only a binding agreement to prevent Iran from enriching uranium to weapons-grade levels or whether it also aims to curb Tehran’s ballistic missile program and regional activities.
Khamenei appears to be employing delaying tactics, hoping circumstances shift in his favor or that he can stall until the next US elections. Meanwhile, Trump continues to tighten sanctions and increase military threats, either directly or through Israel.
Another critical challenge is the risk of public unrest due to soaring prices and a growing sense of political instability.
While the Islamic Republic has repeatedly demonstrated its willingness to use deadly force against protesters, its ability to quash mass uprisings is not guaranteed.
If essential goods approach hyperinflation levels, even the security forces and loyalist cadres—who rely on fixed incomes—could begin to waver.
Tensions between Iran and the United States have risen sharply since Donald Trump re-entered the Oval Office on 20 January, presenting multiple risks of escalation.
A key deadline in October 2025 looms over whether European countries will trigger the snapback mechanism to re-impose United Nations sanctions removed as part of the Iran nuclear deal in 2015.
Indications, not least by President Trump himself, that he would like to negotiate a new agreement to address Iran’s rapidly-advancing nuclear program, have been offset by his administration’s restoration of its ‘maximum pressure’ policy on Iran.
Trump’s transactional nature and unconventional style of decision-making means nothing can be ruled out in a high-stakes confrontation without a clearly-defined plan.
Caught in the middle are Iran's Arab neighbours, where large-scale projects aimed at future-proofing economic development and growing non-oil sectors would be jeopardized by any conflict involving Iran.
‘De-risking’ has become a mantra in Arab capitals and particularly in Riyadh as the landmark year of 2030 draws closer and as the ‘giga-projects’ associated with Vision 2030 move into construction and delivery phases.
Qatar this month called for a diplomatic solution to the US-Iran standoff over Tehran's nuclear program and argued against military action.
The desire to reduce exposure to regional volatility has been evident in the process of rapprochement with Iran since 2020, with Saudi Arabia, the UAE, and Kuwait restoring full diplomatic ties with Tehran in 2022 and 2023 and maintaining regular dialogue on key issues of interest.
This was evident in regional responses to the war in Gaza after 7 October 2023 as the conflict did not regionalize, in part because there was little appetite in any capital on either side of the Persian Gulf for any escalation.
Excluded once, not twice
Back in 2015, officials in some Arab capitals and also in Israel expressed frustration that they were not included in the negotiations between Iran and the P5+1 that culminated in the signing of the Joint Comprehensive Plan of Action (JCPOA), from which Trump’s first administration withdrew in 2018.
In 2020, Saudi leaders called on the incoming Biden administration to consult with them as it sought to revive the Iran deal and explore an expanded ‘follow-on’ agreement, which ultimately did not happen.
As the indirect talks between US and Iranian officials broke down in 2022, the role of Iran's neighbouring Arab countries became more central to keeping open channels of communication between the parties.
Oman and Qatar, along with Kuwait, have long played roles in diplomacy and mediation in regional affairs, as they generally maintained pragmatic working relationships with Iran which, in the Qatari case, included one of the world’s largest reservoirs of natural gas which straddled their maritime boundary.
Officials in Oman placed a premium on balancing relationships with regional partners and being able to utilize their ability to engage with adversaries to address flashpoints and minimize their threat to regional security.
Prior to their passing in 2020, both Sultan Qaboos of Oman and Emir Sabah of Kuwait had well-earned reputations as diplomatists par excellence borne out of decades of involvement in regional affairs.
An example of their efforts to reduce tensions was seen in early 2017 when Emir Sabah sent a letter to Iran’s then-president, Hasan Rouhani, to establish a basis for dialogue after tensions had soared in 2016. Rouhani responded by visiting Kuwait and Oman and Emir Sabah then traveled to Muscat to meet with Sultan Qaboos to follow up, but the subsequent rift over Qatar put paid to those efforts.
In 2025, Kuwait is focused on domestic issues and relatively absent from the regional scene, but there is space for Saudi Arabia to play more of an active role than it has in the past and to build upon the progress in the Kingdom’s relations with Iran since ties were re-established two years ago.
Since 2023, the Saudi leadership has been active in regional diplomatic initiatives concerning Syria, Gaza, and Sudan, and has burnished its credentials as an intermediary with convening power across the Arab and Islamic worlds.
In its ongoing facilitation of meetings of Ukrainian, Russian, and U.S. officials, the Kingdom has shown that it has the ability to navigate between adversaries and leverage its growing non-alignment in world affairs.
Securing a seat at the table in the Russia-U.S. talks may be a prelude to inserting Saudi Arabia into the middle of any negotiations between the U.S. and Iran, thereby minimizing the risks of exclusion from the talks, as in 2015, but Iranian officials may still view the Saudis as too close to the U.S. and not impartial.
The regional mediators of longer standing, Qatar and Oman, are likely to continue to offer their services in relaying messages between the Unites States and Iran and ensuring that opportunities for dialogue remain open, joined by the United Arab Emirates which delivered a letter from Trump to Iranian leaders on 12 March.
Trump redux
Trump’s mercurial approach to policy appears even more unpredictable second time around and has led to whipsaw decisions on tariffs that have added to market uncertainty and left analysts scrambling.
A similar pattern may well overshadow the next phase of the delicate dance between the U.S. and Iran, especially if Trump and Iranian leaders engage in verbal sparring matches of ever-increasing volume.
If this happens, officials in the Gulf States may focus on practical measures to limit the possibility of escalation, whether by accident or design, and identify the parameters of realistic dialogue going forward.
Taken together, their efforts are illustrative of the prevailing opinion in the region in favor of resolving the standoff between Tehran and Washington, and the depth of Emirati (and Saudi) political and economic relationships in DC may resonate with the Trump White House and its Congressional allies.
While tensions in other parts of the Middle East have soared in the wake of the Gaza war and the degradation of Iran’s ‘axis of resistance,’ the rulers in Riyadh, Muscat or Abu Dhabi are more closely aligned than they were in Trump’s first term, and may thus be better placed to play a proactive and productive role in de-escalatory regional dynamics.