Iranian President Mahmoud Ahmadinejad says Tehran has not slowed down its nuclear activity ? contrary to recent news reports ? and his country now has the complete cycle for producing nuclear fuel.  Iran announced last week the development of a guided, or ?smart,? bomb that it could use against its enemies ?when the time comes,? in the words of the Defense Minister. 

Nonetheless, the International Atomic Energy Agency is describing Iran?s recent ?cooperation? over its nuclear program as a ?significant step forward.?   But some Western governments and nuclear experts disagree with that assessment and they worry that Russia and China may oppose further international sanctions against Iran.

In other developments this week, President Ahmadinejad warned that Iran would respond if the United States goes ahead with plans to label the Revolutionary Guards a terrorist organization.    Iranian journalist Ali-Reza Nourizadeh, who directs the Center for Arab-Iranian Studies in London, says that the commanders of the Revolutionary Guards have issued a harsh response to the prospect of Washington?s labeling the Guards as a terrorist organization, suggesting that they have enough missiles to destroy the American fleet in the Persian Gulf.  Speaking with host Judith Latham of VOA News Now?s International Press Club, Mr. Nourizadeh says Iranian military leaders have tacitly admitted that the Revolutionary Guards are ?behind some of the terrorist operations taking place by Shi?a militants? in Iraq.  Nonetheless, he thinks Iran can ultimately be contained through a combination of deterrence and coalition building with moderate Arab states and with Israel. 

Israeli journalist Ron Kampeas of the Jewish Telegraphic Agency says he thinks that Tehran?s military threats are intended as a signal to Israel that Iran is improving the quality and range of its weapons.  He says there is a perceived arms race in the Middle East, and the Iranians want to make it known that they have ?parity? with Israel and are asserting ?Persian hegemony over the Gulf.?  Mr. Kampeas says he thinks a major goal of Iranian rhetoric is to gain the psychological upper hand.

Nadia Bilbassy, diplomatic correspondent for Al-Arabiya television, agrees and calls Tehran?s recent statements part of a ?war of words.?  But she says it difficult to say whether Iran is ?bluffing or serious.?  Ms. Bilbassy says there is ?no way to predict? how this situation will end. 

According to U.S. Secretary of State Condoleezza Rice, America faces no greater threat from a single country than from Iran.  But Nadia Bilbassy notes that the United States inadvertently helped change the power balance in the region by removing ?two enemies of the Iranian regime? ? the Taleban in Afghanistan and Saddam Hussein in Iraq.  Furthermore, she says, Tehran has influence over Syria, over Hezbollah in Lebanon, and over Hamas in Gaza.  And the Sunni Arab governments of the region have a ?realistic? fear that Iran is a ?power to be reckoned with.?

But Ron Kampeas emphases that Iran is extremely ?hard to read.?  Most people believe diplomacy should be tried first, he says, and very few people are advocating a preemptive military strike.  Although Iran poses the greatest threat to Israel regarding any potential nuclear confrontation, Mr. Kampeas says that is ?quite remote right now,? partly because the ?true holders of power in Iran? have no doubt that Israel would retaliate massively.

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