Iran’s strategy: internal incentives and possible scenarios

Motivations of the Iranian leadership

Beyond the surface of government and policy-maker statements, deeper forces drive strategic foreign policy decisions (though these are not related to the concept of the “deep state”). Like any other country, Iran seeks to preserve its sovereignty, ensure its internal and regional security and secure access to resources. Iran shares these fundamental and vital aspirations with Israel and the Arab Gulf states. As a middle power, however, Iran pursues another goal in addition to its vital interests, namely hegemony. Like Turkey, Egypt, and Iraq, Iran has long sought hegemony and a dominant position in the region. This logic of the Iranian state remained unchanged even after the Islamic regime came to power in 1979. The Islamic regime reframed its goal of achieving hegemony by exporting the Islamic Revolution. In addition, the Islamic regime sought to safeguard Iran’s security; in 1980, it launched a war against Iraq and severed ties with the United States in order to preserve its sovereignty, particularly its economic sovereignty based on its oil and gas reserves.[1]

Iran soon came to the conclusion that it could not extend its hegemony in the Middle East, which had been a stronghold of American dominance since the 1950s. The war between Iran and Iraq revealed the limits of Iran’s military and economic power. In light of this, Iran revised its strategic security doctrine in the early 1990s. Under the supervision of the religious leadership and the Revolutionary Guard Corps, it showed no willingness to pursue liberalisation and adopt the Western economic model, and sought to preserve internal order as well as its foreign policy tools.

Iran has identified three methods for maintaining its national security. First, a network of militias in the Middle East that would fight instead of Iran. This is due to the fact that the war between Iraq and Iran completely devastated Iran and claimed millions of lives. To prevent similar conflicts, Iran decided to create a buffer zone of Shia militias around the country.[2] Second, to compensate for the lack of fighter jets (due to international sanctions and high costs), Iranian strategists came up with the idea of developing a missile programme. Third, Iran followed North Korea’s nuclear deterrence model and sought cooperation with North Korea in order to acquire the technology necessary for its nuclear programme.[3] During the presidency of the reformist Mohammad Khatami (1997–2005), all of these ideas were already taking shape and were known to experts in Iranian politics and the intelligence services. The conservative Mahmoud Ahmadinejad (2005–2013) openly implemented these strategies, thus starting a new era of confrontational politics in the Middle East.[4]

The Iranian state is also driven by its expansionist nature, as it is more of an empire than a nation-state. The Islamic regime, which has been in power since 1979, has not altered the general policy of the Pahlavi dynasty and the dynasties that preceded it, which believed that a Shia-Persian-centered government was necessary to ensure the unity of the state, and upheld the same state policies. Since the 19^th century, however, secular and ethnic views of the state have posed a challenge to this endeavour. In order to defeat the highly active secular forces in 1979, the Islamic leadership expanded the Shia dimension, focusing exclusively on the religious aspect and suppressing all processes of secularisation. In addition, it suppressed the demands for autonomy by Iranian Kurds and other groups.

Another internal factor is the deceptive and esoteric nature of Iranian politics and religion. In the Shia tradition, as well as in the ancient Iranian kingdom, politics lends the government an esoteric character, elevating leadership to a kind of inspired, mysterious and absolute power. For one thing, the religious image of the esoteric leader may appeal to a segment of the Iranian population; for another, the true motives and strategic decisions can be concealed and seemingly cloaked in religious beliefs or discourse. Furthermore, they can be justified to the public even if they entail the risk of economic and political isolation, the cost of which is borne by the population due to economic instability.[5]

The third factor is what is known as the “Qizilbash phenomenon”. The Qizilbash (Redheads) were members of Azerbaijani and Anatolian Turkic tribes who formed the backbone of the Safavid Empire; they were radical Shia and esoteric warriors who had amassed too much power even for the Safavid state. Today’s Revolutionary Guard Corps is similar to the Qizilbash in that it has become a doctrine-based force that ultimately controls the state itself.[6]

At the level of political sentiment, the internal driving force of national pride can play a significant role in Iranian politics. This factor has led Egypt and Iraq astray in the past as well. Iran—like Egypt, Turkey, and Iraq—was once a great civilisation and empire that dominated the region. As a result, the radical geopolitical changes of the past two centuries were not taken into account when shaping its understanding of history. Iran expects the United States, Israel, and Arab states to respect its ambitions for power, its right to pursue a military nuclear programme based on enrichment and its role as a regional leader. This strategy has remained essentially unchanged under successive Iranian administrations.[7]

Decentralisation is another key internal factor that must be taken into account. The ruling religious leadership of the Iranian state has realised that it lacks the necessary capabilities to directly govern a country as vast as Iran with centralised power. As a result, it created a polycentric political system that appears to function semi-autonomously but requires religious approval for important decisions and appointments. This led to feudalisation, since every power centre—whether organised around a major institution or an individual—weakens the state and fosters corruption and inefficiency. Tension and rivalry develop among the members of the elite. Unlike the presidency and the military, which have distinct roles, the Revolutionary Guard Corps pursues its own objectives in decentralised defence.[8]

Iran’s strategy

We need to distinguish between two aspects of the strategy. Security measures are key components of the internal strategy. The Shah’s secret service, the State Intelligence and Security Agency (SAVAK), operated with great efficiency, and the Islamic regime renamed it SAVAMA (Ministry of Intelligence), retaining the same staff and maintaining the same efficient control over the country. As funding increased over time, SAVAMA became even more effective. The Basij, a paramilitary volunteer group comprising thousands of young people and affiliated with the Islamic Revolutionary Guard Corps (IRGC), assists SAVAMA in its work. Practically every street in Iran has surveillance posts; they operate in the most critical areas of public life and exercise strict control over the population.[9]

Religious practices and rhetoric are also used to reinforce this control, particularly popular Shia religious practices, which are sustained by pilgrimages to holy sites, as well as customs and beliefs associated with Shia mourning rituals and visits. The Islamic regime also exploits the Palestinian issue to rally the population against Israel and the West and to divert attention toward an external enemy.[10]

Internal security measures may be effective for a certain period of time, but they have remained ineffective in terms of the state’s interests. Over the past 20 years, Iran has been plagued by ongoing political and economic turmoil. Within Iran, ethnic minorities—particularly the Kurds, Arabs, and Baluch—support the militias that are actively carrying out attacks in the country. The younger generation opposes the religious rules imposed on women and has emigrated to the West in large numbers. Furthermore, the security apparatus hinders the economic and political freedoms that are essential for development. This is destabilising the Iranian regime and putting it at risk. Many members of the Iranian government oppose internal security measures or face financial difficulties, which is why they pass information to the CIA or Mossad. Furthermore, due to the close ties between various security agencies and religious leaders, control over freedom of expression and movement is total, much like under communist regimes, which drives a significant portion of society into opposition.[11]

In terms of foreign policy, Iran’s strategy is based on an all-or-nothing game, in which it takes risks that could lead to its own destruction in order to force the other side to capitulate first. During the war between Iran and Iraq (1980–1988), Iran enlisted millions of young people in suicide attacks, making it impossible for Iraq to win the costly war on land. Iran has also established a network of militias in Iraq, Yemen, Lebanon, Gaza and Syria in order to make a war against Iran too costly for the Americans, thereby forcing the United States to abandon its goal of eliminating Iran’s nuclear arsenal. As a result, in 2015, Obama relented and signed the Joint Comprehensive Plan of Action with Iran. Iran’s strategy remained unchanged even during Trump’s presidency, but Trump was a risk-taking Republican who was prepared to play the retreat card and lull Iran into a false sense of security with the promise of a deal, leading to two devastating wars (in 2025 and 2026). Iran still holds the Strait of Hormuz card (and the Strait of Bab el-Mandeb card, under the control of the Yemeni Shia Houthi militia), which it is playing to the fullest in the current negotiations. Trump responded with a blockade, vowing to continue until either the U.S. or Iran backed down.[12]

Iran applies the same strategy toward both Israel and the Arab Gulf states. In other words, it forces them to give in if they don’t want to see more loss of life and greater economic losses. The Iranian regime manufactured tens of thousands of missiles and drones, making the risk of war too costly for Israel and the Arab Gulf states. As a result, they blackmailed them for years into recognising Iran’s dominance in the Middle East. Despite the fact that it has inflicted enormous losses on Iran in terms of both human lives and finances, it has continued to bomb Israel and the Arab states in the current war. The downside of this plan is that it is very costly, while Iran lost thousands of lives and hundreds of billions of dollars’ worth of infrastructure in 2025 and 2026, and isolated itself from its neighbours.[13]

Possible scenarios

There are only three possible outcomes to this all-or-nothing strategy: either Iran gives in, or the U.S. and Israel give in, or the standoff continues for years to come.

The first scenario suggests that Iran would agree to limit its missile and drone programmes and give up its militias and enriched uranium. Trump calls this situation unconditional surrender. This is the most likely scenario, and the U.S. is willing to make a few minor concessions to Iran in order to save face, particularly in the form of financial incentives. The biggest problem is that the enriched uranium could be stored in Pakistan, Canada, the Nordic countries, China or Japan, rather than insisting that it be shipped to the United States. In exchange for Iran handing over its enriched uranium to the United States, the United States could potentially provide financial compensation to Iran in the form of financial assistance and the release of frozen assets. The issue of the militias can also be resolved if they transform into political parties (especially the Iraqi Shia militias), although there is no guarantee that peace will prevail in these countries.

In the second scenario, Israel and the United States back down. This is only possible if two things happen at the same time: the Democrats take control of Congress and put pressure on Trump, and the Strait of Hormuz drastically affects oil prices, leading to a global economic crisis. Iran can withstand the blockade for a few months, but the global economy cannot. More importantly, without Iranian oil, China cannot sustain its economy for long. Thus, continuing the war with Iran will pose a challenge for the United States if the Republicans lose the elections in November 2026, and even Israel may capitulate if Netanyahu loses the elections in October 2026.

Under the third scenario, the United States and Israel decide to continue the war as soon as the current negotiations break down. Under this scenario, Iran’s last resort will be to disrupt maritime traffic in the Red Sea and the Strait of Hormuz. If that happens, the U.S. and Israel will persuade other countries to help reopen the Strait of Hormuz. This scenario would extend the conflict to Yemen and Iraq and have a significant impact on the global economy. Everyone will pay a heavy price, but Iran will suffer even more, as bombing its energy facilities would completely destabilise the Iranian state, thereby creating the potential for civil war involving divisions and ethnic minorities.

Summary

From a European perspective, the war in Iran is unnecessary and will only lead to an energy and economic disaster that comes at the worst possible time—in the midst of the energy crisis triggered by the war in Ukraine. Without oil and gas from the Persian Gulf, Europe has few and costly options; therefore, in the coming weeks and months, Europe’s primary challenge will be to secure its energy supply and save European economies from collapse. The European Union’s leadership does not want to get involved in conflicts with Iran or China, and instead follows the Democrats’ agenda, which focuses on the conflict with Russia. If the United States reaches an agreement with Iran, the Europeans will be able to secure their energy supply and focus all their efforts on Ukraine. If not, the EU can wait until the Democrats take control of Congress and possibly win the presidency again in 2028.

What motivates Iran’s strategy?

Three main factors shape Iran’s strategic behaviour:

• regime survival and internal control
• the pursuit of regional hegemony
• building asymmetric deterrence (militias, missiles, nuclear option)

What are the most important internal factors?

Power structure

• A multi-centred, semi-decentralised system
• Key player: Revolutionary Guard Corps (IRGC)
• Religious legitimacy → masking political decisions

Regime stability

• Extensive surveillance (secret service + Basij)
• Religious issues (Shia narrative, Palestinian cause)
• Internal repression as a tool for stabilisation

Structural weaknesses

• Ethnic tensions (Kurds, Arabs, Baluchis)
• Dissatisfaction among the younger generation
• Fragmentation of the elite and corruption

The three pillars of Iran’s security strategy

1. Proxy network (militias) → Direct war is too costly
2. Missile and drone programme → Lack of air superiority
3. Nuclear deterrence → Safeguards against the US

How does Iran’s foreign policy strategy work?

Key principle: “all or nothing” 

Iran’s goal:

• maximising the cost of the conflict for the opponent
• the political defeat of the opponent (the U.S., Israel, the Gulf States)

Tools:

• Threat of the Strait of Hormuz
• activation of regional militias
• continuous escalation at a controlled level

Main weaknesses of the strategy

• extreme economic costs
• international isolation
• increase in internal instability
• over-dependence on non-state actors

Possible scenarios

Scenario 1: Iran gives in (most likely)

Features:

• limiting the nuclear and missile programmes
• suppression of militias
• easing of sanctions

Consequence:

• economic stabilisation
• the loss of political prestige is partly manageable

Scenario 2: USA/Israel give in

Features:

• a turning point in U.S. domestic politics
• global energy crisis

Consequence:

• Iran’s regional position strengthens
• de facto acceptance of the nuclear programme

Scenario 3: A protracted war

Features:

• blocking of sea routes
• regional escalation (Yemen, Iraq)

Consequence:

• global economic shock
• Iran’s severe internal destabilisation

What does this mean for Europe?

Key risks:

• energy supply collapse

Strategic dilemmas:

• Alignment with the U.S. vs. autonomy
• Priority on Ukraine or the Middle East