Diplomacy is reclaiming a role in Iran's nuclear drama, but little attention is being paid to a conflict of interests that is likely to complicate Tehran's path to a settlement. The objectives of the western powers are clear: a series of confidence-building measures yielding a durable arms control agreement. Iran's Supreme Leader, however, has to reconcile opposing aims. Ali Khamenei needs America as an enemy and a robust nuclear infrastructure to legitimise his rule. For a long time, he believed he could advance the nuclear programme at a tolerable cost to Iran's economy. Yet now, persisting with convenient enmities will further erode the economy – and could threaten his hold on power. Washington's latest diplomatic gambit depends on whether Ayatollah Khamenei can resolve this dilemma.