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Dealing with Iran's nuclear program will be one of the most pressing foreign policy issues facing Barack Obama as he begins his second term. While the focus thus far has been on whether America is ready to go to war if aggressive economic sanctions fail to bend Iran's will, his administration should also prepare to deal with the sanctions' potential success. There's evidence that the measures are seriously hurting Iran's economy, and that this is changing Tehran's posture. What will Mr. Obama do if Iran agrees to negotiate?

Last year, the U.S. and its allies started direct talks with Iran. There was no breakthrough, and then diplomacy stalled as the Obama administration turned its attention to elections at home. Meantime, Iran's economy buckled under pressure, with the rial losing 80 per cent of its value. That has raised the expectation that Iran may be finally ready to negotiate. Now, Washington will need to be ready with a clear diplomatic strategy.

We know what the elements of a deal look like. The U.S. wants Iran to limit its enrichment activity to no more than 5 per cent, if not completely end enrichment, to relinquish its stockpile of 20 per cent enriched uranium, to close down its deep underground secret facilities, to open its nuclear activities to intrusive United Nations inspections, and to provide guarantees that they will not build nuclear weapons. Iran, in turn, wants recognition of its right to enrichment, and the lifting of economic sanctions.

The challenge is that these negotiations will be long and tedious, and can't be conducted in a vacuum. There will be gains and setbacks. Israel and Arab allies will apply pressure. Then there's an increasingly complex and worrying regional dynamic to contend with: the faltering Arab Spring, particularly in Egypt, Tunisia and Libya; the disintegration of Syria; and the radicalization and rise of al-Qaeda in North Africa.

Mr. Obama can't implement a strategy with Iran isolated from the rest of the region. Successful diplomatic negotiations with Iran, therefore, require a new American Middle East strategy.

This must include re-engagement with the Arab world, economic support for the newly democratic states of Egypt, Libya and Tunisia, restarting the Arab-Israeli peace process, confronting rising radical extremism, articulating a clear endgame for the Syrian conflict, and recognizing that military action against Iran will inflame the region and lead to greater instability.

More important, however, these policies must fit within a broader strategic vision. Since 9/11, we have seen competing narratives for America's role in the Middle East, including stability, counterterrorism and democracy promotion. Mr. Obama needs to define a clear vision through which he will implement a new Middle Eastern strategy, and which will frame potential negotiations with Iran.

Mr. Obama does not have unlimited time to develop such a strategic vision. For one, the current level of sanctions can't persist forever. Intense economic pressure is effective in the short run, but the removal of Iranian oil from the global market will ultimately have a significant impact on the global economy.

What's more, if the Iranians decide they can't live with the current level of sanctions or believe that the U.S. is not prepared to make a deal, then we may see more aggressive retaliation to break the logjam, such as closing the Strait of Hormuz.

The international community could also tire. The Russians and Chinese signed on to sanctions to get Iran to the table. If we don't deal with them, and don't have a diplomatic strategy, then they might walk away. Both are also tied up in th protracted conflict in Syria, and will be looking at Iran through Bashar al-Assad's lens.

In the end, then, Mr. Obama needs to make a bold move, and quickly. While his strategy of harsh sanctions satisfied the American electorate and has likely moved Iran closer to the negotiating table, successful resolution of this conflict, as well as the interrelated regional crises, requires a new vision for Middle East policy.

The key question for the new Obama administration is not what happens if the Iranian sanctions fail, but what happens if they succeed.

Vali Nasr, an Iranian-born American, is dean of Johns Hopkins University's School of Advanced International Studies. The author of The Shia Revival and Democracy in Iran, he sits on the U.S. State Department's Foreign Affairs Policy Board and served as senior advisor to the late Richard Holbrooke for Afghanistan and Pakistan until 2011. He will be in Toronto on Nov. 26 to take part in the Munk Debate on Iran's nuclear ambitions.