Iranian ships provoked four separate incidents with U.S. military vessels in the Persian Gulf at the end of August. And on Aug. 28, a member of the Iranian nuclear negotiating team was arrested by Iranian officials on espionage charges. Iran’s Supreme Leader Ali Khamenei is growing restless and lashing out.
More than a year after the nuclear deal was signed, relations between the U.S. and Iran remain frosty. Tehran is irked by the fact that Washington continues to insist that Syria’s Bashar Assad must go, while Iran continues to support him. Tehran is also angered by Washington’s continued support for Saudi Arabia–Iran’s longtime rival for Middle East dominance–in that country’s flailing war effort in Yemen.
But most of all, Iran’s leaders are deeply frustrated that the nuclear agreement hasn’t revitalized the Iranian economy, a main selling point of the agreement to the Iranian people and skeptical hard-liners. Iranian leaders blame the U.S. for not living up to its end of the deal. Iran still can’t readily access American banks, which severely limits its financial dealings; the limitations were put in place not because of the nuclear issue but because of Iran’s sponsorship of terrorism and its human-rights record. European and Asian banks are wary of dealing with Iran for fear that U.S. sanctions could still reach them. And for all the potential of the Iranian market, the country’s geographic curse–its neighborhood includes the somewhat less-than-stable states of Syria and Iraq–still weighs on the minds of foreign investors.
The U.S., for its part, is concerned about Iran’s continued development of its ballistic-missile program, which Washington views as contrary to the spirit of a key U.N. resolution. It’s also flustered by Iran’s seesawing relationship with Russia. On Aug. 16, Russia announced that it had been granted access to Iranian bases to bomb Syria. It was a surprising move given Iran’s historic sensitivities about sovereignty. But just a week later, Tehran rescinded that invitation, claiming that Moscow’s constant crowing about its use of Iranian bases was both “ungentlemanly” and a “betrayal of trust.” Washington and the West had been worried that a budding Iranian-Russian alliance would complicate their political and economic interests in the region; now the West has to deal with two maverick countries with something to prove instead of just one.
Iran is in a tough spot. The nuclear deal hasn’t paid off as planned. Even with sanctions reduced, it’s not the player in the region it once was. This was the year Iran was supposed to become a global heavyweight. That isn’t happening. Iran is signaling to the world that it is unhappy and still dangerous, a potent combination.
Of course, things could be worse for Iran. At least it’s not Turkey.
This appears in the September 12, 2016 issue of TIME.