The Complex Relationship Between the United States and Iran: From Allies to Adversaries

The relationship between the United States and Iran has been marked by shifting alliances, geopolitical conflicts, and persistent tension. Understanding their history is crucial to grasp current events, nuclear negotiations, and future prospects for peace in the Middle East.

Early 20th Century: Oil, Exploitation, and Resentment

The discovery of vast oil reserves in Iran by the British in the early 20th century revealed the country’s potential as a major energy superpower. However, under the Anglo-Iranian Oil Company, Iran received only 16% of oil profits, while the British retained a massive 84% share. This unfair distribution laid the foundation for deep anti-Western sentiments among Iranians.

US-Iran Relations During World War II

In 1941, Britain and the Soviet Union invaded neutral Iran to remove its Shah, who was suspected of Nazi sympathies, and to secure supply routes. His young son, Mohammad Reza Pahlavi, was installed as the new Shah, more aligned with Allied interests. After the war, Britain maintained control over Iran’s oil, intensifying Iranian frustration and nationalism.

The 1953 Coup and the Rise of Dictatorship

When Iranian Prime Minister Mohammad Mosaddegh nationalised the oil industry in 1951, Britain and the United States orchestrated a coup to overthrow him in 1953. The Shah’s authoritarian rule that followed cemented his image as a Western puppet, despite Iran becoming a strategic Cold War ally due to its oil reserves and location.

The 1979 Iranian Revolution and Hostage Crisis

The Shah’s oppressive regime, secret police, torture, and forced Westernisation alienated leftists, the working class, and conservative Shiite Muslims. By 1979, a mass revolution overthrew him, establishing an Islamic Republic under Ayatollah Khomeini.

Later that year, when the US allowed the Shah to enter for cancer treatment, Iranian revolutionaries stormed the US Embassy in Tehran, taking 52 Americans hostage for 444 days. The crisis resulted in the US severing diplomatic ties with Iran in 1980.

Iran-Iraq War and US Involvement

Shortly after the revolution, Saddam Hussein’s Iraq invaded Iran, aiming to exploit its political chaos. The US supported Iraq with weapons and intelligence to counter Iran’s influence. Meanwhile, Hezbollah, backed by Iran, carried out several deadly attacks on US targets, including the 1983 Beirut bombings.

In 1988, after a US warship struck an Iranian mine, Operation Praying Mantis destroyed Iranian naval assets. Later that year, a US cruiser mistakenly shot down Iran Air Flight 655, killing 290 civilians, an event that remains a major grievance.

Post-Cold War Tensions and the Nuclear Dispute

In 1995, the US imposed a total embargo on dealings with Iran. President George W. Bush’s “Axis of Evil” speech in 2002 signalled renewed hostility. However, the Obama administration’s Joint Comprehensive Plan of Action (JCPOA) in 2015 lifted sanctions in exchange for Iran limiting its nuclear program.

In 2018, President Trump withdrew from the JCPOA and reinstated harsh sanctions, prompting Iran to threaten nuclear escalation and block oil routes in the Strait of Hormuz.

Escalations from 2019 to Early 2020

Tensions rose with tanker attacks in the Gulf, the downing of a US drone by Iran, and reciprocal tanker seizures. In December 2019, a rocket attack killed an American contractor in Iraq, leading to US airstrikes against Hezbollah militias.

On January 3, 2020, the US assassinated General Qasem Soleimani, a top Iranian military leader, escalating hostilities. Iran retaliated with missile strikes on US bases in Iraq. Tragically, the same day, Iran’s air defence mistakenly shot down Ukraine International Airlines Flight 752, killing all 176 onboard.

Current Developments in 2025

As of mid-2025, US-Iran tensions remain unresolved. Negotiations to revive the nuclear deal have stalled, with Iran demanding the removal of sanctions first, while the US insists on compliance before relief. Recent drone skirmishes in the Red Sea involving Iranian proxies and US naval assets, as well as internal unrest in Iran over economic instability and crackdowns, continue to strain prospects for de-escalation.

Meanwhile, the Biden administration has renewed limited diplomatic backchannels with Iran via Oman and Qatar, aiming to avoid direct confrontation and to address concerns over regional proxy conflicts, especially in Yemen and Iraq. Iran, under President Pezeshkian’s new administration, signals a desire for economic recovery through Western engagement but remains uncompromising on its missile program and regional influence.

Conclusion: A Precarious Future

The history of US-Iran relations reflects deep-seated distrust fuelled by interventions, coups, ideological divides, and proxy wars. While temporary diplomatic breakthroughs such as the nuclear deal offered hope, enduring peace requires addressing decades of grievances, mutual security concerns, and regional geopolitical rivalries.

Read more: Major Middle East Conflicts Explained

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