Western nations are offering Iran a favorable package of economic incentives, if only Iran will abandon their nuclear programs. The key to acceptance of this offer is Iran's ability to keep its nuclear weapons development program secret from UN inspectors. Iran is a police state, with lots of "state secrets" that could be declared off limits to UN inspectors. But a major problem are the multi-sensor American space satellites, that can detect all manner of nuclear research. If Iran cannot successfully hide from this sort of thing, they can simply accuse the Americans of making it all up. But U.S. intel agencies actually get on quite well with many of their Western counterparts. Thus Iranian stonewalling of solid evidence would be risky, as Iran would have to depend just on an anti-American European media to make its case. In any event, Iran has nothing to lose by accepting the deal, going through the motions, and seeing what it can get away with.
June 18, 2006: Over a hundred thousand troops engaged in training exercises, meant to prepare them for defeating an American invasion. These exercises are mainly for domestic propaganda, although the government invites foreign journalists to observe, and see how Iran will fight against any bullying by the U.S. The Iranian military is actually rather threadbare and ramshackle. Iran spends only about $6 billion a year on defense, while the Arab states on the other side of the Gulf spend over $30 billion a year.
June 16, 2006: The Arab Gulf states are quietly, but in ways difficult to hide, practicing their reaction to an Iranian attempt to close the Straits of Hormuz, and halt Arab oil shipments. The nations on the Arab side of the Gulf spend a lot more on military operations than do the Iranians, and have a formidable naval and air forces at their disposal. Some of the Arab preparations apparently involve close cooperation with American and NATO forces in the region. The Arab countries try to keep these military preparations quiet, because diplomacy has long been the preferred way of dealing with Iran, the regional superpower.
Iran is also trying to prevent the name of the Persian Gulf from changing to the Arabian Gulf. The Arab Gulf nations have been pressuring media for decades to accept the new name. Iran has been fighting back, as best it can, by banning any publications to call the Gulf anything but the "Persian Gulf."
June 13, 2006: The U.S. imposed economic sanctions on four Chinese and one American company for providing Iran with missile components. Any assets these companies have in the U.S. are frozen, and American firms are not allowed to do business with the sanctioned firms. This is a minor annoyance for China and Iran, but it is noticed.
In Pakistan, Baluchi separatists blew up the tracks of the rail line that went to Iran. Baluchi tribesmen on both sides of the border have become increasingly violent. In Iran, the Baluchis, who are Sunni Moslems, also complain of religious persecution at the hands of the majority Shia Moslems.