Iran's rise owes much to Bush's Iraq and Afghan wars

By Alistair Lyon, Special Correspondent - Analysis

TEHRAN (Reuters) - Five years on, Iran can thank the United States for unwittingly aiding its drive for regional power by ousting Saddam Hussein, one of Tehran's deadliest foes.

The U.S. military had already defeated Afghanistan's Taliban after the September 11 attacks on U.S. cities in 2001 -- with the unintended consequence of wiping out another of Iran's enemies and tilting the local balance of forces in Tehran's favor.

"The removal of these two regimes without powerful successor states benefited Iran greatly...and opened elbow room for Iran to spread its influence," said Vali Nasr, senior fellow at the Washington-based Council on Foreign Relations.

Iran cannot entirely rule out U.S. military action to destroy its nuclear sites, and its oil-reliant economy may prove vulnerable a few years hence, but for now it is riding high.

The Iraqi army's swift collapse in 2003 left Shi'ite-ruled Iran with no indigenous military rival nearby, weakening the Arab world and its mostly Sunni Muslim governments.

Windfall oil revenues have further fuelled the Islamic Republic's heady sense of power under its combative president, Mahmoud Ahmadinejad, who has defied Western-led efforts to contain Tehran's nuclear aspirations through U.N. sanctions.

"Every 24 hours we are earning $270 million ... in hard currency -- a magic amount," said Iranian economist Saeed Leylaz. "Iran can transfer its petrodollars to buy loyalty internally and strategic partnerships externally."

In the last five years, non-Arab Iran has become a weighty player in Iraq, nurturing ties to Shi'ite and other factions. It has gained clout elsewhere in the Arab world via its alliances with Syria, Lebanon's Hezbollah and the Palestinian Hamas group.