There's still time for sanctions to force Iran's hand

In the war of words over Iran's nuclear programme, the week that just ended veered dangerously close to conflict. At least, that's what leaders on both sides would have us believe.

Vitriol makes good headlines, but shouldn't be confused with policy. There is still reason to believe that patience and pragmatism will win the day.

During a week in which the Pentagon promised "to respond" to Iranian intransigence, and Iran's supreme leader, Ayatollah Ali Khamenei, warned that Iran would retaliate with "10 times" the force, it was uncharacteristically Israel that sounded a note of caution.

Speaking at a conference on Thursday, the Israeli defence minister, Ehud Barak, said his country would "consider taking action" only if economic sanctions failed to get the job done. Israel remains a dangerous variable in this equation, but this last point is key.

Sanctions are only now beginning to take effect, depleting state coffers and leading to the devaluation of the Iranian rial. European sanctions on Iranian oil, meanwhile, don't take full effect until July. While Iranian president Mahmoud Ahmadinejad has predicted Iran's economy will grow in 2012, few impartial economists believe him. Moving towards a military option before these new tools are allowed to work would be premature, as well as wildly irresponsible.

For now, the biggest danger to regional stability is the risk of self-fulfilling prophecies. History is replete with examples of leaders looking to walk to the edge of conflict, only to be pushed over it by the weight of their rhetoric. The British politician David Lloyd George described the First World War as governments looking to avoid conflict but instead "backing over the precipice".

Diplomatic tools may not convince Tehran to abandon enrichment activities, which are popular among its people. After hints that inspectors from the International Atomic Energy Agency would be given greater access to pick apart the Iranian programme, teams returned to Vienna last week largely empty-handed.

And yet the alternative - abandoning diplomacy and dropping bombs on Qoms, Natanz and other nuclear sites - would only embolden Iran and its supporters. For all the talk of how dangerous a nuclear-armed Tehran would be, this regime would gain far more strategically if it were pre-emptively attacked. That would garner regional support and harden the hawkish stance of its domestic leaders.

Today Iran is more isolated than ever, especially with allies in Damascus facing defeat. Giving up on economic power in favour of force would be handing a hard-earned advantage back to Tehran.