Since the information on Iran's clandestine weapons program was revealed accidentally through investigation of Libyan nuclear program, the European-3 or Britain, France, and Germany have been working to entice Iran on giving up its nuclear weapons program in exchange for better economic ties, technology, and financial assistance. They even got into a so-called Paris Agreement where Tehran promised to suspend its program in lieu of settlement. After Ahmadinejad came to power (over suspicious and questionable election practices), Tehran unilaterally terminated this agreement and continued with its enrichment program using technology it secretively procured from Pakistan but claiming that it has the right to such access under the NPT.
With failing negotiations and talks, there is talk in Western strategic communities on a pre-emptive strike on Iran's nuclear facilities along the line of Israel's raid on Saddam Hussein's Osirak nuclear reactor in 1981 by a "coalition of the willing" that is led by the US along the lines of the Iraqi invasion. As the US is considering the deployment of a second aircraft carrier to the region, outgoing UN Secretary General Kofi Annan has already warned that a military intervention in Iran will be "unwise and disastrous." He advised a negotiated settlement to the issue.
However, negotiated settlement on Iran or a UN Security Council sanction route is going nowhere. As negotiations stalled with the EU-3, Russia, with strong trade and political ties to Tehran, stepped in and offered a dedicated enrichment facility for Iran based in Russia but that proposal too has been rejected by Ahmadinejad. The sanctions route has been stalled by Beijing and Moscow as they feel that this will push Tehran as they have Pyongyang. However, while Russia has been categorical about not willing to allow enrichment on Iranian soil, China has been more wishy-washy about its position citing "technical difference" but for obvious selfish reasons. But US State Department officials seem upbeat saying that they were "very close" to getting a 15-0 vote to impose strict conditions on Tehran.
How Ahmadinejad will respond to these strict conditions and looming sanctions is unpredictable. While Iran has always asked for more time to study any proposal, it has consistently maintained its right to enrichment and has always countered the deal with their own demands often unacceptable to the group of 6 (EU-3 plus US, Russia, and China). A climb down from hard-line position by Ahmadinejad will erode his constituency back home and weaken an emergent regional power story that his regime has tried to build up. At the same time, if he does not comply, financial sanctions will cripple the economy even more and push the country further into chaos.
The choices available for West are not many either. While they may agree on diplomatic sanctions and negotiations the "coalition of the willing" will include very few from Europe and even if Tel Aviv wants to join a raid, it is unlikely to be invited as it would only unite Arab resistance to the move. The US may find better partners among Sunni states which will be willing to see a hard-line Shia Iran fall.
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