The US State Department’s Rewards for Justice program is offering up to $15 million for information on four Chinese individuals involved in supplying Iran’s Islamic Revolutionary Guard Corps (IRGC) with US-controlled technology.
The IRGC, including its Qods Force, is designated by the US as a Foreign Terrorist Organization and has been linked to armed groups such as Hamas, Hezbollah, and Iran-backed militias in Iraq.
The US government has accused the Chinese nationals—Liu Baoxia, Li Yongxin, Yung Yiu Wa, and Zhong Yanlai—of using front companies to illegally procure and transfer US electronic components to Iran.
“Beginning as early as May 2007, Liu and her associates allegedly utilized an array of front companies in the People’s Republic of China (PRC) to send dual-use US-origin electronic components to IRGC-linked companies that could be used in the production of UAVs, ballistic missile systems, and other military end uses,” the State Department said in its announcement.
The Justice Department charged them in January 2024 with conspiring to smuggle thousands of restricted components for use in Iranian drones and missile systems.
Last week, Rewards for Justice offered a reward of up to $15 million for information that could disrupt financial networks supporting a drone-production arm of Iran’s Islamic Revolutionary Guard Corps' elite Qods Force called Kimia Part Sivan Company (KIPAS).
The company has also sourced key drone components from foreign suppliers, according to US officials.
At the start of the year in March 2024, Iran was already grappling with a broken economy and the looming threat of political unrest. Regionally, however, it still appeared strong and could plausibly project itself as a serious challenge to US and Israeli interests.
Conflict with Israel
As the year began, Israel was deeply engaged in its war with Iran-backed Hamas in Gaza. Tehran confidently claimed that its regional adversary was stuck in an unwinnable conflict, boasting about its so-called Resistance Front and threatening to escalate against both Israel and US interests. Yemen's Houthis were already disrupting shipping in the Red Sea and launching missiles at Israel.
Houthi attacks on maritime trade which began in November 2023 following a declaration by Iran’s Supreme Leader Ali Khamenei inflicted an estimated $200 billion in losses on the global economy.
Less than a month into the Iranian year, Tehran launched a large-scale missile and drone strike on Israel In April 2024 in response to Israeli attacks on Iranian targets in Syria.
While most projectiles were intercepted with minimal damage, the Islamic Republic framed it as a significant blow against the "Zionist entity." At the time, Tehran appeared strong, seemingly capable of deterring its most determined adversary.
However, the tide began to turn in late July when Hamas leader Ismail Haniyeh was killed in an explosion while staying at a government guesthouse in Tehran.
It remains unclear whether the incident was caused by a planted explosive or an Israeli missile strike, but the ability of Tehran's arch-foe to strike seemingly anywhere was lost on no one.
The assassination would be just one of many, crescendoing with the killing of Hezbollah leaders via their bomb-laden communication devices and culminating in the assassination of its storied leader Hassan Nasrallah.
Political crisis
Before these epochal blow, Iran suffered another major shock in May when hardline President Ebrahim Raisi and his foreign minister died in a mysterious helicopter crash in northwestern Iran.
Many doubted the official explanation of bad weather, which was never conclusively proven, fueling speculation about a high-level internal plot or an Israeli operation.
Raisi had been widely regarded as ineffective, presiding over a rapidly deteriorating economy since taking office in 2021.
In June, Iran held presidential elections, with several key candidates disqualified through a vetting process controlled by Khamenei. Ultimately, Masoud Pezeshkian, a politician with no executive experience, faced hardliner Saeed Jalili in a low-turnout runoff and won.
During his campaign, Pezeshkian made it clear that he had no plans beyond executing Khamenei’s directives.
Some Iranians still hoped for limited reforms and a diplomatic breakthrough to ease US sanctions. However, when Khamenei formally banned negotiations in early February 2025, Pezeshkian pledged loyalty to his decision, disappointing even his Reformist supporters.
Economic crisis
By mid-2024, with Hezbollah and Hamas weakened and Israel growing more confident in striking Iranian military targets, Iran’s economic woes deepened. The rial, which had been around 550,000 per dollar in September, plunged to 900,000 by February and even hit one million by March 18.
The worsening economic picture underscored a government unable to halt a downward spiral. Severe energy shortages crippled both households and industries throughout fall and winter, with the government regularly announcing power shutdowns across the country due to heating and electricity failures.
Iran’s oil exports to China continued through intermediaries and at deep discounts, but the Trump administration escalated sanctions on oil tankers and trading entities following Biden’s late-term crackdown on exports.
Revenues from these limited exports fell far short of meeting the government’s foreign currency needs, especially given Tehran’s ongoing financial commitments to regional proxy groups.
Bleak outlook
Many political insiders in Tehran now say Pezeshkian’s administration may be incapable of addressing the worsening economic crisis. The only potential relief would come from easing US sanctions, but Khamenei has so far resisted Trump’s pressure to make concessions.
It remains unclear whether Washington seeks only a binding agreement to prevent Iran from enriching uranium to weapons-grade levels or whether it also aims to curb Tehran’s ballistic missile program and regional activities.
Khamenei appears to be employing delaying tactics, hoping circumstances shift in his favor or that he can stall until the next US elections. Meanwhile, Trump continues to tighten sanctions and increase military threats, either directly or through Israel.
Another critical challenge is the risk of public unrest due to soaring prices and a growing sense of political instability.
While the Islamic Republic has repeatedly demonstrated its willingness to use deadly force against protesters, its ability to quash mass uprisings is not guaranteed.
If essential goods approach hyperinflation levels, even the security forces and loyalist cadres—who rely on fixed incomes—could begin to waver.
Khalid Mehdiyev, the man who has now admitted he intended to kill Alinejad at the behest of the Iranian government allegedly, was stalking her house for several days in the summer of 2022 when she saw him.
“He had a phone in his hand … I saw he was talking,” Alinejad said in court, recalling how she thought the man was just admiring her garden.
Alinejad had recently returned from a trip in San Fransico and was getting ready to go another trip, this time with a friend to Connecticut when she saw Mehidyev, who she described as "gigantic" and "the big guy" outside her Brooklyn home near her pristine garden.
“I just had all the tomatoes, basil, cucumbers in my hands. I was walking to go to my inside door. When I was walking in the drive path, I saw the guy — the big guy.”
She even approached the man hired to kill her momentarily, thinking he was saying something to her. He wasn't.
"I am sorry. I thought you were talking to me," Alinejad told him, she said in court.
Alinejad wasn't suspicious of Mehdiev at first. Strangers would often stop and take photos from her garden. But this one was different, she felt.
"He was in the sunflowers staring straight into my eyes," Alinejad recalled.
The chilling incident convinced her something was off. Shortly after, she called the FBI.
The encounter happened on July 28, 2022, the same day assassin Mehdiyev was arrested by police, found with a ski mask and loaded AK-47 assault style rifle in his vehicle just outside of Alinejad’s Brooklyn home.
The day could have been the end to Alinejad's life.
“I was trying to get the easy way to kill her," the bearded Mehdiyev confessed in the Manhattan courtroom Thursday.
But his assassination plans failed with some errors.
Mehdiyev ran a stop sign as authorities trailed him, leading to his arrest.
Mehdiyev, a member of the Thieves in Law gang said he received orders from Rafat Amirov and Polad Omarov at the behest of Iran’s government to kill the journalist who uses her platform to expose the Islamic Republic’s repression.
As a government witness, who has made a deal with the Feds, Mehdiyev pleaded guilty to attempted murder and gun charges, but Omarav and Amirov are both on trial.
Masih Alinejad confronts the accused in court
When Alinejad walked into the courtroom, she was wearing her signature flower in her hair and a white scarf representing her campaign "White Wednesday" against the compulsorily hijab.
It was her first time coming face-to-face with alleged co-conspirators of Mahdiyev in the murder for hire plot.
The courtroom on 500 Pearl Street in Manhattan was packed for her appearance.
Anxiety filled the air in the courtroom until Alinejad made her testimony. Voices gasped as she entered, walking past the two accused.
Women, Life, Freedom protestors who had their eyes blinded by Iran's security forces at the height of the nationwide uprisings filled the courtroom to support the woman who fights for them.
Among them was Mersedeh Shahinkar, who had lost an eye after being shot by Iran's security forces during the 2022 protests.
There was a moment in the courtroom when Shahinkar blew a kiss to Alinejad who was in the witness stand. She noticed, beaming at the gesture of love and blew a kiss back.
It was also the first time Alinejad took the stand as a witness, facing those accused of plotting her murder. Instead of being dead - she lived to testify.
Alinejad, undeterred, stared down the two men on trial, radiating strength as she testified.
The court also heard testimony from FBI agent Stefanie Roddy from the Executive Inspector Division. Agent Roddy oversaw the foreign transfer of custody of Amirov from an unnamed foreign country.
Roddy revealed evidence obtained from Amirov's transfer which included a residence permit from the Islamic Republic of Iran, Iranian bank currency and an Iranian bank slip.
Photos of the Iranian residence permit were shown in court, revealing an alias name for Amirov Farhaddin Mirzoev.
The court also played a recording from the FBI where Amirov admitted that he resided in Tehran, Iran.
The case before the courts is part of a broader push by the US government attempts to crackdown on transnational repression.
Tensions between Iran and the United States have risen sharply since Donald Trump re-entered the Oval Office on 20 January, presenting multiple risks of escalation.
A key deadline in October 2025 looms over whether European countries will trigger the snapback mechanism to re-impose United Nations sanctions removed as part of the Iran nuclear deal in 2015.
Indications, not least by President Trump himself, that he would like to negotiate a new agreement to address Iran’s rapidly-advancing nuclear program, have been offset by his administration’s restoration of its ‘maximum pressure’ policy on Iran.
Trump’s transactional nature and unconventional style of decision-making means nothing can be ruled out in a high-stakes confrontation without a clearly-defined plan.
Caught in the middle are Iran's Arab neighbours, where large-scale projects aimed at future-proofing economic development and growing non-oil sectors would be jeopardized by any conflict involving Iran.
‘De-risking’ has become a mantra in Arab capitals and particularly in Riyadh as the landmark year of 2030 draws closer and as the ‘giga-projects’ associated with Vision 2030 move into construction and delivery phases.
Qatar this month called for a diplomatic solution to the US-Iran standoff over Tehran's nuclear program and argued against military action.
The desire to reduce exposure to regional volatility has been evident in the process of rapprochement with Iran since 2020, with Saudi Arabia, the UAE, and Kuwait restoring full diplomatic ties with Tehran in 2022 and 2023 and maintaining regular dialogue on key issues of interest.
This was evident in regional responses to the war in Gaza after 7 October 2023 as the conflict did not regionalize, in part because there was little appetite in any capital on either side of the Persian Gulf for any escalation.
Excluded once, not twice
Back in 2015, officials in some Arab capitals and also in Israel expressed frustration that they were not included in the negotiations between Iran and the P5+1 that culminated in the signing of the Joint Comprehensive Plan of Action (JCPOA), from which Trump’s first administration withdrew in 2018.
In 2020, Saudi leaders called on the incoming Biden administration to consult with them as it sought to revive the Iran deal and explore an expanded ‘follow-on’ agreement, which ultimately did not happen.
As the indirect talks between US and Iranian officials broke down in 2022, the role of Iran's neighbouring Arab countries became more central to keeping open channels of communication between the parties.
Oman and Qatar, along with Kuwait, have long played roles in diplomacy and mediation in regional affairs, as they generally maintained pragmatic working relationships with Iran which, in the Qatari case, included one of the world’s largest reservoirs of natural gas which straddled their maritime boundary.
Officials in Oman placed a premium on balancing relationships with regional partners and being able to utilize their ability to engage with adversaries to address flashpoints and minimize their threat to regional security.
Prior to their passing in 2020, both Sultan Qaboos of Oman and Emir Sabah of Kuwait had well-earned reputations as diplomatists par excellence borne out of decades of involvement in regional affairs.
An example of their efforts to reduce tensions was seen in early 2017 when Emir Sabah sent a letter to Iran’s then-president, Hasan Rouhani, to establish a basis for dialogue after tensions had soared in 2016. Rouhani responded by visiting Kuwait and Oman and Emir Sabah then traveled to Muscat to meet with Sultan Qaboos to follow up, but the subsequent rift over Qatar put paid to those efforts.
In 2025, Kuwait is focused on domestic issues and relatively absent from the regional scene, but there is space for Saudi Arabia to play more of an active role than it has in the past and to build upon the progress in the Kingdom’s relations with Iran since ties were re-established two years ago.
Since 2023, the Saudi leadership has been active in regional diplomatic initiatives concerning Syria, Gaza, and Sudan, and has burnished its credentials as an intermediary with convening power across the Arab and Islamic worlds.
In its ongoing facilitation of meetings of Ukrainian, Russian, and U.S. officials, the Kingdom has shown that it has the ability to navigate between adversaries and leverage its growing non-alignment in world affairs.
Securing a seat at the table in the Russia-U.S. talks may be a prelude to inserting Saudi Arabia into the middle of any negotiations between the U.S. and Iran, thereby minimizing the risks of exclusion from the talks, as in 2015, but Iranian officials may still view the Saudis as too close to the U.S. and not impartial.
The regional mediators of longer standing, Qatar and Oman, are likely to continue to offer their services in relaying messages between the Unites States and Iran and ensuring that opportunities for dialogue remain open, joined by the United Arab Emirates which delivered a letter from Trump to Iranian leaders on 12 March.
Trump redux
Trump’s mercurial approach to policy appears even more unpredictable second time around and has led to whipsaw decisions on tariffs that have added to market uncertainty and left analysts scrambling.
A similar pattern may well overshadow the next phase of the delicate dance between the U.S. and Iran, especially if Trump and Iranian leaders engage in verbal sparring matches of ever-increasing volume.
If this happens, officials in the Gulf States may focus on practical measures to limit the possibility of escalation, whether by accident or design, and identify the parameters of realistic dialogue going forward.
Taken together, their efforts are illustrative of the prevailing opinion in the region in favor of resolving the standoff between Tehran and Washington, and the depth of Emirati (and Saudi) political and economic relationships in DC may resonate with the Trump White House and its Congressional allies.
While tensions in other parts of the Middle East have soared in the wake of the Gaza war and the degradation of Iran’s ‘axis of resistance,’ the rulers in Riyadh, Muscat or Abu Dhabi are more closely aligned than they were in Trump’s first term, and may thus be better placed to play a proactive and productive role in de-escalatory regional dynamics.
