The permanent members of the U.N. Security Council have so far failed to agree on how to enforce a draft resolution that would call on Iran to stop all uranium enrichment and reprocessing activities in its nuclear program.  The impasse could work in favor of Iran where President Mahmoud Ahmadinejad appears increasingly confident that his government is gaining the upper hand in the nuclear standoff. 

Since taking office last year, President Ahmadinejad has successfully whipped up nationalist support for his country's nuclear program.   Many Iranians have taken to the streets to express support for the program, which Tehran says is for peaceful civilian purposes. 

The United States, Britain, and France suspect otherwise.  U.S. President Bush: "The Iranians should not have a nuclear weapon, or the capacity to make a nuclear weapon."

Iranian President Mahmoud Ahmadinejad

But Mr. Ahmadinejad shows no sign of bowing to international pressure.  One reason for this may be that Iran is counting on Russia and China to oppose any moves at the U.N. to impose sanctions.

Another reason may be that Mr. Ahmadinejad believes the current world situation favors Iran and undermines international unity on the nuclear issue, according to John Calabrese of the Middle East Institute. 

John Calabrese

"It is a moment when oil prices are very high and Iran's national coffers are overflowing with it, when sensitivity in terms of oil prices having spiked and energy security concerns are universally at the top of the policy agenda," he said.  "It is a time when the relations between the United States and Russia on a variety of different issues are somewhat more fractious or divisive than they might have been at the outset."

And Calabrese adds Iran believes the U.S. has its hands full in Iraq. "So it seems to me timing is everything and the Iranian side, looking at the international and regional landscape, and its own position vis-a-vis the United States, may have decided this is the time to push the issue."

Iran's vast oil wealth enables the Ahmadinejad government to defy international pressure.  However, at the same time, Iran's inefficient state-run economy could be vulnerable to international sanctions, says James Phillips of the Heritage Foundation.

James Phillips, Heritage Foundation

"The Iranian economy is the regime's Achilles heel because even though with the high price of oil it is raking in a lot of oil revenues, it is not wisely using those revenues," he said.  "It has a very creaky and corrupt economic system and young Iranians do not have much of an economic future given the economic system there."  

In New York, foreign ministers of the permanent members of the Security Council have failed to agree on the wording of an Iran resolution. 

Margaret Beckett

The disagreement is not over whether Iran should have a nuclear weapon, but rather what is the best way to prevent that  - said Britain's new Foreign Secretary, Margaret Beckett. "No one wants to apply sanctions if it is not necessary but what everybody wants is to get Iran to recognize that the international community is serious in its insistence that we cannot continue with the assumption that Iran can just continue to flout the will of the international community in this way," she said.

President Ahmadinejad, who traveled to Indonesia Tuesday, appeared unconcerned.  He shrugged off the White House dismissal of his letter to President Bush as containing no new proposals. 

"Islamic behavior does not allow us to publicize the content of the letter," he said.  "We will wait for reaction and behavior of the addressees of the letter and then we will make decisions.  Fortunately we can make decisions any time we want."

Meanwhile, Iran's top nuclear negotiator, who is in Greece, says there is still time to reach a diplomatic solution to the standoff.  Ali Larijani told reporters the issue should be resolved through the International Atomic Energy Agency, not the U.N. Security Council.  At the Security Council, diplomats say agreement over a resolution on Iran is not expected any time soon.