Earlier this year Iran began allowing Syria to buy Iranian supplies and have them shipped in via truck through Iraq or via ship to Syrian ports. To make this work Iran gave Syria a billion dollar line of credit, which has now been increased to $4 billion. This was a gift and Syria hoped to get over a hundred million dollars-worth of goods a month from Iran. The actual amount coming in has been lower because of rebel interference. Without this aid, the government forces will disappear much more quickly. Sanctions have made it difficult to buy supplies from its usual foreign providers. The Iraq route has become more risky, as Iraqi Sunnis have been harassing and blocking these shipments. Moreover most of eastern Syria is Sunni and under the control of rebels. But with the help of bribes (cash or goods) a few routes are kept clear by government troops and many trucks do get through.
Iraq is also helping by recently deploying 20,000 troops to the Syrian border and attacking Syrian rebel bases on the Iraqi side of the frontier and guarding the roads in western Iraq (which is largely Sunni, often tribes with kin across the border in Syria). The sea route is still the safest but it takes nearly a week longer. The Iranian financial aid is desperately needed in Syria, where the local currency is rapidly losing its value (going from 50 Syrian pounds a dollar to 150 in two years) and the Iranian currency (the rial) is not much better. But if the Iranians can get goods into Syria, that is a big help.
Russia is allied with Iran in supporting the Assads and is trying to organize a peace conference. Iran is willing to participate, as are the Assads, but there is no unity among rebel factions on the usefulness of such confrontations. Despite the recent help from Hezbollah and disagreements among the rebels, the Assads are still in big trouble.
Hezbollah has become increasingly vocal about its support for the Assad government in Syria. Iran has apparently ordered its protégé Hezbollah (a Shia militia in Lebanon) to openly side with the Assad government in Syria. Thousands of Hezbollah gunmen are now being moved to the Syrian border and many are already fighting inside Syria. There, the rebels have been reporting increasing Hezbollah involvement for months, but until this month Hezbollah officially denied any such involvement. That was because the Arab world is largely united in its opposition to the Assads. Not so much because they are Shia but because they are bloody tyrants and toadies to the hated (by most Arabs) Iranians. For over two decades Hezbollah has made a reputation in the Arab world as someone who will stand up to Israel. Hating Israel has been a popular activity in the Arab world since the 1940s, but the popularity is beginning to wane. While Hezbollah got respect for its anti-Israel activities, that is at risk as Hezbollah openly sides with the Assads. To make matters worse, this move increases anti-Hezbollah sentiment inside Lebanon. Hezbollah has always represented the minority Shia of Lebanon and done so with increasing brutality (in order to bully the majority non-Shia population into submission). Now the non-Shia are becoming more aggressive against Hezbollah.
The main reason for making this move in Syria is the fact that Iran bankrolls Hezbollah (and the Assads) and has promised to give Hezbollah modern Russian anti-ship, anti-tank, and anti-aircraft missile systems currently in Syria or soon to arrive from Syria or Russia. Iran denies having any troops in Syria, but there is considerable evidence of several hundred advisors and instructors, many apparently from the Quds Force (an elite outfit that provides aid to pro-Iran terrorists and rebels worldwide).
The oil trade sanctions on Iran have proven difficult to get around, and the U.S. and other Western nations enforcing the sanctions keep countering Iranian moves to get around the fiscal and trade restrictions. For example, India has long been a major customer for Iranian oil but shipments to India fell 26 percent last year and that decline continues. Indians prefer to get oil from nearby Iran, but sending payment to Iran has proven more and more difficult. Skirting the banking restrictions risks sanctions on the offenders (Indian importers). In response Iran keeps adding new incentives. In addition to lower prices and ship insurance (now banned for Iran internationally) Iran is now offering to build an underwater pipeline (along the coast, to avoid Pakistan) to transport oil and gas to India.
This is not an attractive option as it is long term and the sanctions are likely to get worse. Iran needs more oil revenue now. While Iran puts a up a brave front, they are hurting economically. Losing over $5 billion in oil revenue monthly, Iranian GDP is believed to have fallen 5-10 percent in the last year.
Unemployment and inflation are up, as is dissatisfaction with the growing shortages of imported goods. The U.S. plans to make it worse, with new sanctions (beginning July 1st) banning gold sales to Iran (which has been using gold to pay for imports).
Iran has not taken all this passively, as the U.S. reports that a growing number of hacker attacks on American banks and utilities (power, sewage, and water operations) are coming from Iran. Some of these attacks are quite skilled, indicating that Iranian hackers have gotten much better recently or that Iran has been hiring mercenaries to carry out these attacks. Such hacker mercs are available but may back away if the U.S. begins to hunt down and arrest them as terrorists.
May 26, 2013: Iran released photos of over a dozen 16 wheel TEL (Transporter Erector Launcher) vehicles for two or three stage ballistic missile. These recently delivered (from Iranian factories) TELs are vehicles built to carry, then erect and survive the launch of a ballistic missile. The new Iranian TELs were based on trucks designed to haul non-military cargo, but Iran often employs "dual-use" technologies that can easily be adapted to military use. Large trucks modified to be TELs are often not real TELs. There are a lot of manufacturers out there who build huge (12-20 wheel) trucks, and these are often used to carry military equipment (like 50-70 ton tanks). A 12-50 ton ballistic missile is no problem, but installing the hydraulic gear and controls to erect the missile to a vertical position is tricky. Even more difficult is hardening the rear of the vehicle to minimize the damage from the rocket exhaust. This last bit can be dropped if you only expect to use these TELs once for a live fire. The 16 wheel Iranian TELs may be "use once and abandon the trailer" models.
May 24, 2013: Iran denied that the wreckage of a UAV found (two weeks ago) in shallow water off Bahrain was of Iranian origin. But photos of the wreckage (in shallow water) are clearly of a UAV design used by Iran. Bahrain, and the Arab League, continue to feud with Iran over Iranian claims to own Bahrain and support for Shia Bahraini seeking to overthrow the Sunni monarchy there.
May 21, 2013: The senior clerics (the “Guardians Council”) declared that only eight candidates (all of them known loyalists to the clerical dictatorship) would be allowed to run in the June 14th presidential election. Some 30 female candidates were also banned and the senior clerics declared that women could not run the country under any circumstances. This move was directed at several troublesome candidates who might have won. This even included a senior cleric, Ayatollah Akbar Hashemi Rafsanjani, who had served as president before (1989-1997) but was known to favor reforms. Current president Mahmoud Ahmadinejad cannot run again and his personal favorite candidate was also banned.
Iran denied any involvement with the ten people (eight Saudis, a Lebanese, and a Turk) Saudi Arabia recently arrested and charged with spying for Iran. The latest arrests were the result of information obtained from some of the 17 similar arrests made two months ago (16 Saudis and one Iranian). Iran denied any connection with the earlier group as well.
May 20, 2013: Two weapons smuggling gangs were declared destroyed. One had brought weapons in from Afghanistan and the other group moved weapons in from Iraq.
May 19, 2013: Two convicted spies were executed. The government said the two worked for the United States and Israel but few details were available and the United States denied involvement and Israel refused to comment.
May 13, 2013: An international fleet of 34 warships, led by a British officer, began conducting mine-clearing exercises in the Persian Gulf. This is a continuation of U.S. organized series of international mine clearing exercises. The force in the Persian Gulf has ships and personnel from 41 nations and has been conducting mine clearing exercises in the Persian Gulf all month. Naval mines are the most effective weapon Iran possesses if it decides to attack shipping in the Persian Gulf.