August 24, 2006: The government dismissed UN calls that nuclear weapons development stop by the end of the month. A European offer of economic goodies was dismissed as well. UN nuclear inspectors were turned away from an Iranian nuclear research facility, in direct violation of the nuclear non-proliferation treaty. Iran knows that the only way to stop their nuclear weapons program is to attack it. But that would stop Iranian oil production, and the effect on the world oil markets would be to increase the price of oil by 20-40 percent. In this game of bluff, Iran believes that, given a choice between Iran having nukes, and higher oil prices, the world will pick the former. If the UN tries to impose more sanctions, Iran can threaten to shut down its oil production. In effect, Iran already has a "weapon of mass destruction;" its oil shipments and their impact on the price of oil. As Iran is demonstrating, if it has a powerful weapon, it is not afraid of using it.
Russia announced it would not support sanctions against Iran. This is mainly because Iran has become a major customer for Russian military and non-military products.
August 23, 2006: American commanders in Iraq continue to pile up evidence (prisoners, documents, equipment, electronic intercepts) that Iran is supporting Shia extremists in southern Iraq. The Iranians deny everything.
August 19, 2006: Military exercises were held throughout the country. The main objective appeared to provide local and international media with as many photo opportunities as possible. Lots of gunfire, artillery and missile launchings. What was most striking was the prominence of 1970s era American weapons and equipment still in use. Iran has some 1980s era Russian stuff, and lots of home made copies of the older American and Russian equipment. Iran has been under several embargos for the past two decades, and has had to manufacture or smuggle in parts to keep these older weapons going. But that has also meant that troops don't get to use their warships, aircraft and armored vehicles a lot, because of the scarcity of spare parts. Thus the troops are poorly trained. They are also poorly led, as officers are selected more for their loyalty to the religious dictatorship, than for their military abilities.
August 15, 2006: The crackdown on reformers continues. Despite opinion polls, and elections, showing the majority of the population opposes the current religious dictatorship, the clerics have no intention of giving up power. The religious leadership are using a classic approach to the problem. By creating real, or imagined, foreign enemies, they are making it more difficult for political opponents to rebel against the current government.
One of the aftereffects of the Iranian backed violence from Hizbollah, is that Israel is now more interested in attacking Iran's nuclear weapons program. Arming Hizbollah with all those rockets was seen as reckless, and now more Israelis can see Iran actually getting nuclear weapons, and using one of their existing long range missiles to nuke Israel. Diplomacy does not seem to be having any effect on the Iranians. Maybe Israeli missiles and bombers would.