The only notable European state that so far has held back from threatening war against the Iranians is Germany, which holds the lion's share of European investment into and trade with Iran. But even there the situation is starkly different from two years ago, when Gerhard Schroeder ruled. Not only is Angela Merkel's Germany far more willing to consider Washington's point of view, European sanctions against Iran would censure Iran's primary nuclear supplier -- Russia -- in a way that would likely avoid a major dust up. As Germany (gently) reasserts its supremacy in Europe, such fights without pain are an excellent means of garnering credibility and momentum.

With all this war and sanctions talk circulating on the European continent, Iran is longing for the early days of the Iraq war, when it could adroitly manipulate the divide between the United States and Europe. Back then, when the Iran-EU-3 talks were still in play, Iran used the nuclear negotiations a way to buy time to further its nuclear program and bargain with the United States over political concessions it was seeking in Iraq.

But with Europe shifting its mood and the United States using every opportunity to remind Tehran that a military option is still on the table, the Iranians are now looking at a very uncertain future. At this time, it would be useful to re-examine Iran's Iraq policy moving forward.

Before the delivery of Gen. David Petraeus' Iraq report, the expectation was that U.S. President George W. Bush had lost his fighting power against Congress, and that a withdrawal was all but imminent. The celebrations in Tehran could be heard across the Atlantic as Iranian President Mahmoud Ahmadinejad announced to the world that Iran was preparing to fill the vacuum in Iraq.

And then came the buzz kill.

Despite repeated declarations that Iraq had barely reached one out of 18 political and security benchmarks, Bush responded to Petraeus' surprisingly optimistic report by declaring that the United States would remain committed to Iraq (Iraq's Sunni community in particular.) Troop levels would gradually decrease, but Iran would be staring at U.S. forces across the border for a long, long time. In short, Bush was setting an Iraq agenda for a long-term, robust troop presence that would extend well beyond his own presidency.

Iran now has loads to reconsider. A long-term troop presence in Iraq and continued U.S. support for Iraq's Sunni community not only complicates Iran's plans to consolidate its gains in Iraq, but also puts Iran in a very uncomfortable situation in which it faces a constant security threat from the United States across its border. Moreover, the nuclear dossier can be seized by Washington (as well as the Europeans) at any time to make a case for military action against Iran. Tehran might be feeling confident that the United States lacks the bandwidth to carry out an attack against Iran now, but give it two, three years, and Tehran's clerical regime will be living in a cloud of uncertainty while being boxed in by the United States on both its western and eastern borders in Iraq and Afghanistan, respectively.

Now Tehran must decide whether it is still worth its while to negotiate an Iraq settlement with the United States, bet that it will not underestimate the U.S. a third time, and wager that enough pain can be inflicted on U.S. troops and enough chaos can perpetuate in Baghdad to force the United States into leaving the region. The Iranians still have a number of options at hand moving forward, but the decision-making process just got a lot trickier.