THE latest Pentagon policy paper has named two US rivals: China and Iran. There is small likelihood of a conflict or confrontation between America and China in the foreseeable future.

On the other hand, the US-Iran dynamic appears to be driving these two countries, almost ineluctably, towards confrontation and conflict.

For over a decade, the US, and its Israeli ally, have declared that an Iran with nuclear weapons, or even a nuclear weapons capability, will be 'unacceptable'. Iran was initially cooperative, offering Washington a comprehensive deal in 2002.

Despite its rejection, diplomacy continued at and through the International Atomic Energy Agency to find ways to credibly contain Iran's growing nuclear capabilities to declared 'peaceful purposes' Tehran offered a sophisticated legal case for possession of the full nuclear fuel cycle. But suspicion that Iran would follow the route first followed by India -professing peaceful nuclear purposes until it achieved weapons capability prevented several possible technical compromises on the Iranian nuclear programme.

Yet, through thetwo Bush administrations, there seemed to be no agreed policy in an Iraq-preoccupied Washington on how to respond to Iran's nuclear programme and posture.

The first decade of the millennium saw an impressive rise in Iran's power and influence in the 'Greater Middle East'.

Two of its main regional adversaries the Taliban in Afghanistan and Saddam Hussein in Iraq were removed by the US, and replaced with Tehran-friendly regimes. The US itself became bogged down in Iraq and Afghanistan.

Iran acquired a prominent role in almost every strategic issue in the region: Iraq whose dominant Shia parties all had close historical and ideological ties with Tehran; Lebanon where the Shia Hezbollah were applauded by the 'Arab Street' as the only credible resistance to Israel; Palestine where the most popular movement, Hamas, found support and succour from Tehran; and Afghanistan where Iran not only retained its old links with the Northern Alliance, but simultaneously with President Karzai and elements of the Tahban-ledinsurgency.

However, the regional strategic picture has changed radically over the last two years. The Obama administration has adopted a more comprehensive and aggressive policy to roll back Iranian power and restrain its nuclear ambitions. It has taken advantage of regional developmentsto pursue its anti-Iranian objectives.

After the suppression of the so-called Green movement and evidence of internal differences within the Tehran power structure, the US has found it easier to secure additional sanctions against Iran.

Tehran faces other problems. Its main regional ally, Syria, long ruled by the Alawite Shia sect, is now confronting turmoil and possible ouster by an opposition, supported by regional rivals: Turkey and Saudi Arabia. In Lebanon, Hezbollah has been politically damaged by its support for the Syrian regime and the UN commission's indictment of two of its members for the Hariri assassination.

Utilising an incriminating report from a US-friendly IAEA, UN and unilateral sanctions against Iran have escalated.

The latest moves are aimed at drastically curtailing Iran's oil revenues. The US Congress has passed a measure to de legitimise dealings with the Iranian central bank. Only some powerful countries will be able to circumvent this US restriction to import oil from Iran. The EU is contemplating a more straightforward ban on oil imports from Iran. Unlike prior sanctions, these measures evenwith caveats and loopholes are likely to hit Iran where it hurts.

This is not all. The US and Israel are also taking more 'direct action'. Western subversion in Iran's Sistan-Balochistan province has been an open secret for some time. The Stuxnet virus, which sabotaged Iranian nuclear centrifuges, was another visible action. Targeted assassination of Iranian scientists has been widely reported. Rumours are rife that an Iranian missile production facility was recently completely destroyed by foreign sabotage, killing the leading Iranians responsible for the missile programme.

Iran's threat to close down the Strait of Hormuz to all oil shipments, and its accompanying military exercises, are an indication of the serious concern in Tehran at the steps mounted by its adversaries to restrain not merely its nuclear programme but also its regional power and influence.

Tehran has several options in its retaliatory armoury. First, it can create political havoc in parts of the region Iraq, Afghanistan, Lebanon, to mention only the most obvious. Subversion could be escalated across the waters of the Gulf.

But Iran is unlikely to be able to block the Strait of Hormuz. For one thing, it will be counterproductive, since some Iranian oil will still be going through the Hormuz, for example, to China. Second, actions to block the strait will requiremilitary measures that would be construed by its adversaries as justification to go to war with Iran.

The danger of war is being intensified by other factors. First, there is the debate under way in Israel regarding the pros and cons of a military strike against Iran's nuclear facilities. This debate appears to be more serious than merely political pressure on Washington. Apart from damaging and delaying if not destroying Iran's nuclear programme, a conflict with Iran would shift global political attention away from the Palestinian issue and reduceinternadonalpressure onIsraelto reach a fair deal with the Palestinians. It would, willy-nilly, draw the US into the conflict on Tel Aviv's side. Iranian retaliation would be mostly possible against targets in the neighbourhood.

A second concern is the rising rhetoric in the US presidential campaign. Apart from Ron Paul, the leading Republican contenders have advocated military action against Iran. Such rhetoric could escalate once the Republican nominee faces off against Obama. If the president's opinion polls are dismal closer to election day, a 'bold' strike against Iranmay be seen as a popular, if dangerous, gambit to win the election. A US military, frustrated by a decade ofquagmire, and less vulnerable now to Iranian retaliation after withdrawalfrom Iraq, could well concur with an aerial war against Iran The results and consequences of such major aerial attacks cannot be fully anticipated, but they are unlikely to be palatable to any of the protagonists.

Aerial strikes will not fully eliminate Iran's numerous nuclear facilities. At best, Iran's programme would be delayed by a few years. Human and physical destruction in Iran would be considerable since many facilities are close to population centres and US-Israeli strikes would need to also eliminate Iran's retaliatory conventional capabilities.

Even with a diminished capability, Iran would retaliate, including through asymmetric attacks especially against regional rivals. Tehran would most likely openly declare its decision to acquire nuclear weapons. Iranians would unite behind a hard-line leadership against the West and its friends. Most immediately, the price of oil would spike to unprecedented levels, even if other producers expand production.

Are these likely catastrophic consequences sufficient to convince leaders on both sides to step back from the road to war? Is a deal, based on the 2002 Iranian offer, still possible? That should be the aim of all right-thinking policymakers.

The writer is a former Pakistan ambassador to the UN.