The week in Iran was marked by President Rouhani’s maneuvers to maintain control of the nuclear issue while pursuing economic recovery at home.

On the surface, the immediate challenge to Rouhani’s authority came from the distant voice of US Secretary of State John Kerry, who said almost two weeks ago that “military options were still on the table” if Iran did not fulfil November’s interim nuclear deal. Politicians, clerics, and especially the Revolutionary Guards maintained a daily campaign declaring Iran’s supremacy over Washington’s bluster and warning that the Islamic Republic would strike “without boundaries” to any US attack.

However, much of this was posture — for now. Iran finally agreed with the 5+1 Powers (US, Britain, France, Germany, China, and Russia) on the opening of talks on a comprehensive deal, convening in Vienna on February 18. Tehran also hosted inspectors from the International Atomic Energy, who visited the Gachin uranium mine, with further inspection of sites scheduled for February 8.

Rouhani could proceed because he has the protection of the Supreme Leader against the hard-liners, arranged in a deal last month in which the President promised to pull back from his pursuit of political and cultural openness and the release of political prisoners. On Thursday, the deal led to Grand Ayatollahs pledging their support of the Government’s strategy on both the interim deal and the forthcoming talks.

The President needs that security as he faces continued US pressure on Iran’s weak point, the economy. American officials spent the week telling foreign governments, firms, and investors that “Iran is not open for business“, despite the interim deal and a limiting easing of sanctions on Tehran.

The challenge for Rouhani came out through news that Iran’s inflation rate was almost unchanged at 35% and that Iran’s leading oil customers — China, Japan, India, and South Korea — reduced purchases by 15% in 2013.

FORECAST

For now, Rouhani and his inner circle can safely pursue the comprehensive nuclear talks, but their position is still vulnerable both to American rhetoric and the Supreme Leader’s state of mind. Indeed, the two are linked: had Kerry’s ill-chosen words not been followed by continued White House resistance to new sanctions, Ayatollah Khamenei’s scepticism of the Americans might have led to the withdrawal of his support for negotiations.

The Rouhani Government is now committed to that process because of the economic stakes. Largely unnoticed in their recent campaign to get investment — including from leading Western oil and gas companies — is the dependence of those talks on the comprehensive nuclear agreements. Without the security of a likely deal, the firms are unlikely to make long-term commitments to Iran’s economy.

There were ripples of news on the political and cultural front, such as the move of detained opposition leader Mehdi Karroubi to his home, but these only pointed to Rouhani’s decision not to press for change in these areas. Indeed, the most notable criticism of the President by the weekend was not from hard-liners, but from disappointed reformists.

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