For Iran, a country that has been proudly striding towards a conflict of some kind, 2012 will be the year for some tough decisions. And the choice is simple, agree to abandon any nuclear efforts that are not directed towards civilian energy, or face military action.
The pain of US led embargoes are now apparent, and the symbolic move to halt their already insignificant exports to the UK and France, is an act of desperation. Iran is already struggling to find buyers for up to a quarter of its output in the run-up to the July 1 start date for EU sanctions. Compound this with the Chinese complaints at being overcharged for oil (they have duly cut imports by half), and India's insistence to pay in rupees (due to banking sanctions), and Iran finds itself in great economic peril.
It seems the patience of President Obama is being rewarded, but for how much longer can the White House stall Israeli plans for a pre-emptive strike on Iranian facilities? The answer to this question can only come from the Iranian clerical leadership. Faced with growing unrest at home due to the effect of a 25% fall in the value of the rial in the past year, the bluster of the Ayatollah seems increasingly hollow.
Front month Nymex crude is back over $105 per barrel, and US gasoline prices are headed back over $4 - the dangers to the nascent, and fragile, US recovery are obvious.
As this Guardian editorial succinctly puts it, Iran is "stumbling towards war". It seems a simple either/or moment - back down or face the dual threat of sanctions and a trigger-happy Israel. Netanyahu has never doubted Iran's intentions to "wipe Israel off the map", no matter if Ahmadinejad's utterance was intended to be merely symbolic. I would suggest that the Ayatollah adopt an equally prosaic mindset in his view of the Israeli threat of military action.