06/27/2014 10:16 pm ET Updated Aug 27, 2014

Iran: What a Difference a Few Months Make

A few months ago the Islamic fundamentalist leaders of Iran were riding high. They had survived tough international sanctions put in place by the United States and the European Union. They had gotten rid of the shrill President Mahmoud Ahmadinejad and replaced him with two new leaders, President Hassan Rouhani and Foreign Minister Mohammed Javed Zarif, who showed a moderate and persuasive face to the world. The Green Movement, which had been crushed in 2009, showed no sign of reviving despite the spread of mass uprising throughout the neighboring Arab world.

The United States was conducting secret direct negotiations with Iran, and an initial nuclear deal left intact most of Iran's extensive nuclear and missile program. Iran looked forward to a final deal that might leave in place most of its infrastructure for an atomic bomb and intercontinental ballistic missiles while sanctions were lifted.

In Syria, Hezbollah, created by the Iranian Revolutionary Guard, was rescuing the regime of Bashar al-Assad, which, only two years earlier, seemed to be on the verge of destruction. Now, in early 2014, with extensive Iranian help, Assad seemed sure to survive and rule most of Syria's important cities and Alawite areas.

After the American withdrawal from Iraq, the Shiite-majority state under Nouri al-Maliki was drawn strongly into the Iranian camp. Maliki even signed an agreement to buy weapons from Iran.

In Lebanon, the minority Shiites, under the leadership of Hezbollah, achieved both a military dominance and a blocking veto in the parliament.

And even Sunni Hamas, which had abandoned its alliance with Iran by opposing Bashar al-Assad, now seemed ready to rejoin the Iranian camp.

The Shiite crescent, winding from Alawite Syria and Hezbollah-dominated Lebanon to Shiite Iraq and Iran, with even a Sunni Hamas addition, seemed to be the wave of the future under Iran's leadership as it moved closer to becoming the world's no. 9 nuclear power.

Yet suddenly, Iran is now facing serious challenges that strike at its economic and military weaknesses. In an Arab world that is less than 10-percent Shiite and distrusts non-Arabs, Persian Shiite Iran faces hostile Arab Sunni fundamentalist movements that are rising in the aftermath of the failures of the Arab Spring. The rise of these movements, with support from Iraqi Sunnis chafing at Shiite domination and the Gulf States, threatens to wipe away much of Iraq, Iran's oil-rich biggest ally. The ascendancy of the Kurds in northern Iraq and ISIS in much of northern and central Iraq will, if it holds, significantly reduce the wealth and power of the remaining southern/central Shiite sector.

The likely intervention of Iranian-backed forces in Iraq would heighten the willingness of he Sunni Arab world to fight on against the "heretical" Shiites. ISIS will also threaten the major gains of the Assad regime in Syria, which has been able to survive with Iranian (and Russian) support.

In Lebanon, the Sunnis, restive as they see Hezbollah troops fighting against fellow Sunnis in Syria, are increasingly hostile to Iran. A political stalemate in Lebanon has been the result, and a civil war is possible.

Hamas, as it dallies with Iran, finds itself being crushed between a revitalized military-run Egypt that has flooded many of the tunnels bringing vital supplies to Gaza and a strong Israel determined to punish Hamas for allegedly kidnapping three Israeli teenagers.

The greatest threat to Iran is the changing Sunni view of Israel. Heretofore, Israel was a hated outcast in the Sunni world, with diplomatic relations with only two of 22 Arab states. Now Saudi Arabia and the Gulf states are seeing Israel as a counterweight to Iran in the military sphere. Egypt under Sisi, having crushed the Muslim Brotherhood, is evidently quietly coordinating action against the jihadists in the Sinai and Hamas in Gaza. This has been welcomed by Israel, which needs the support of countries such as Saudi Arabia and the Gulf states to credibly threaten and possibly even attack the Iranian nuclear program.

What's next?

Iran may be bailed out by the United States with a soft final nuclear deal in exchange for a promise of help to destroy Sunni ISIS in Iraq and Syria. Or the United States may get tough and Iran will then have to confront its worst nightmare. With a small, $500-billion economy, $6,000 GDP per capita and the Third World profile of a petro state, Iran would be exposed as a weakling in the international arena.

Only time will tell whether the Iranian setback is temporary or permanent. Stay tuned.