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Hey everyone,

Welcome to The Under Report, your weekly intelligence brief about the stories that move the world without making headlines. At least that's usually the case, today's deep dive is a look at the modern history of Iran and its collision course with the West.

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P.S. Check out this colorized footage of Iran from the 1950s.

In mid-June 2025, US early-warning satellites lit up as Israeli Arrow-3 interceptors shredded a barrage of Iranian medium-range missiles over the Mediterranean. Simultaneously, explosions rippled across Tehran’s skyline, striking military and nuclear-linked targets, according to preliminary reports, including IRGC facilities and suspected weapons infrastructure. Among the reported targets were IRGC commanders and figures associated with Iran’s defense and nuclear sectors, though exact casualties remain unconfirmed.

Despite the devastation, the Israeli operation bore the hallmarks of a coordinated, multi-theater strike campaign. They were more surgical than scorched-earth. But this was only an overture to the war unfolding before us. The long-simmering shadow war between Iran and the West had finally stepped into daylight.

President Trump declared Iran must offer “unconditional surrender,” while the Pentagon quietly deployed Patriot and THAAD batteries across Gulf states in anticipation of regional retaliation. Oil futures spiked, maritime insurers froze policies in the Strait of Hormuz, and civilian populations ran for safety in Tel Aviv and Tehran.

Over my next two deep dives, we’re going to trace the decades-long collision course that led to this moment. From CIA coups and hostage crises to cyberattacks and proxy wars, this fight has been raging for years. But getting the future right means understanding the many mistakes which led us here in the first place.

The conflict began, as so many do, with money, power, and a bad deal. In the early 20th century, the United Kingdom brokered one of the worst oil contracts in modern history: the Anglo-Iranian Oil Company (now BP) retained approximately 84–85% of Iran’s oil profits, according to most estimates. This left the Iranian state with just 15%, despite the fact that the oil was extracted from Iranian soil, refined by Iranian labor, and exported through Iranian ports.

When Iran’s democratically elected Prime Minister Mohammad Mossadegh came to power in 1951, he didn’t sue the British, he nationalized the oil industry, reclaiming control of Iranian resources. For the British, this was tantamount to theft. For the Americans (on the heels of China’s fall to communism and amid Korean War tensions) it smelled like a prelude to Soviet alignment.

British fury and American paranoia converged into a covert consensus: Iran had to fall in line, but quietly. That meant getting rid of Mossadegh without leaving fingerprints. The result was Operation Ajax, a joint CIA–MI6 plot to overthrow Iran’s democratic government.

At first, Ajax played out like an influence campaign. Clerics were paid to denounce Mossadegh, newspapers ran smear pieces claiming he was a communist puppet, and gangs were hired to stage protests and counter-protests in support of the Western-aligned Shah Mohammad-Reza Pahlavi. When Mossadegh got wind of the plot, he had the Shah’s loyalists arrested. Pahlavi fled to Rome via Baghdad—but the CIA wasn’t done.

Wave two of Ajax turned the city streets into battlegrounds. CIA cash flooded Tehran, handed to mob bosses, army commanders, and street agitators. Mobs ransacked offices, tore down statues, and clashed with loyalist police. In the chaos, Mossadegh’s home was stormed and shelled during a shootout. He surrendered. The Shah returned from exile, and CIA-approved General Fazlollah Zahedi was installed as Prime Minister.

A pro-Western autocracy replaced a fragile democracy. For the Iranian people, it was a clear message: your vote matters—until it interferes with western money and power.

One thing autocracies do well is move fast. With US backing, the Shah launched the White Revolution, a rapid-fire modernization campaign that brought land reform, women’s suffrage, education expansion, and a deep military alliance with the United States. Iran became one of the top recipients of US weapons. Iran became the only US ally to receive F-14s, symbolizing the depth of military cooperation. 

But the cost of modernization was systematized repression. The Shah’s feared intelligence agency, SAVAK, trained with US and Israeli assistance, became infamous for torture, disappearances, and surveillance. Tehran’s Evin Prison, where political prisoners were held, would later be described by Amnesty International as "the worst prison in the world.”

Outwardly, Iran projected the image of a modernizing, secular Middle Eastern monarchy, it was an oil-rich ally in a region the West increasingly viewed as strategic real estate. Western elites toasted the Shah in palaces and profiled his queen in Vogue. Internally, though, the discontent was growing. Merchants, students, clerics, and nationalists all saw the Shah not as a modernizer but as a foreign-backed tyrant.

The seeds of revolution had been planted.

When millions revolted between 1978 and 1979, Ayatollah Ruhollah Khomeini rode the wave from exile to supreme authority, purging liberals and sidelining secular revolutionaries.

The spark came on 7 January 1978, when the government newspaper Ettelāʿāt published a hit piece labeling Khomeini a British agent. Protests erupted in the Iranian city of Qom, and security forces opened fire killing at least five students. A rolling cycle of 40-day mourning marches began, spreading unrest across the country. On Black Friday (8 September 1978), Imperial Armed forces opened fire on tens of thousands gathered in Tehran’s Jaleh Square, killing at least 64 protesters and irreparably fracturing public support for the Shah. With Iranian blood staining the hands of the monarchy, many began to ask: Who was the real foreign agent here?

Weeks earlier, the Cinema Rex fire in Abadan had killed nearly 400 civilians. Many blamed the regime, seeing it as a symbol of the Shah’s failing grip and indifference to human life. The monarchy collapsed five months later during the “Ten Days of Dawn” (1–11 February 1979). This is still celebrated by the Islamic Republic as a national triumph. For many opposition voices, however, it is remembered as the “Ten Days of Torment.” This was a hinge moment in modern Middle Eastern history. The phrase “Stolen Revolution” was later used by secular and nationalist dissidents who felt Khomeini hijacked a populist uprising for theocratic ends.

The anti-royalist movement was a big tent: Marxists, merchants, intellectuals, students, Iranian nationalists, and religious hardliners all stood against the monarchy. But the social network that mobilized them was the Friday prayer infrastructure—mosques became the de facto organizing hubs. Religious institutions were the backbone of the revolution, even if they weren’t always its heart. Dissidents knew they didn’t want the Shah, but few realized they were about to replace one autocrat with another.

Khomeini returned to Tehran on a chartered flight from Paris and quickly declared Iran an Islamic Republic. Within months, political rivals were silenced, the new constitution enshrined clerical rule, and the revolution’s secular ideals were swept aside. On 4 November 1979, radical students seized the US Embassy and took 52 Americans hostage for 444 days. For over a year American networks broadcast the crisis into US living rooms, hardening public opinion against Iran and severing diplomatic ties that remain broken to this day.

The chaos prompted Iraqi leader Saddam Hussein to invade Iran. Not only was this a chance to expand the regional holdings of Iraq, but it could serve as a warning to the new leadership. At this point in history the US supported Saddam in his crusade against Iran. Washington provided intelligence support and dual-use materials to the Iraqi army with a view towards maintaining power projection in the region. While the Shah was unable to maintain power, Saddam remained an autocrat of convenience in the American sphere of influence.

The eight-year bloodbath killed roughly a million people and birthed Iran’s obsession with strategic depth. Tehran would turn the sea of mountains and desert into a shield against foreign invasion at all cost. Meanwhile it built and bought long range missile arrays which could strike out from its defensible territories. Tehran would look to nuclear power as the ultimate guarantor of security. While western power was expanding, Iranian defense was entrenching.

However, this didn't stop civilians from being caught in the crossfire. Late in the war, the US Navy cruiser mistook Iran Air Flight 655 for a fighter jet and shot it down. 290 civilians were killed. From the Iranian perspective, the US and its allies were a constant threat seeking economic dominance through violence or subversion or both. From the US perspective, Iran's radical fundamentalist regime was a ticking time bomb which needed to be defused.

Eric Czuleger is a journalist and travel writer who has lived and worked in over 47 countries. He holds a masters degree from the University of Oxford and he is completing a National Security degree from the RAND school of public policy. He's the author of You Are Not Here: Travels Through Countries That Don’t Exist, and host of the “This Is Not a PsyOp” TikTok channel.

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