It looks pretty likely now that Iran will soon become a nuclear power, in spite of the best efforts of the West. So what happens now? Let's have a look at some of the questions that arise.
Firstly, why is Iran doing all this?
After years of political and economic stagnation, it is experiencing a phase of intense national pride. Its economy is thriving.
Iran insists its nuclear programme is purely peaceful
Since the overthrow of Iraqi President Saddam Hussein, Iran has become the most important power in the Gulf.
And so, in a continent where Israel, India, Pakistan, North Korea and China all have a nuclear capacity, Iran sees that as a matter of status.
Mahmoud Ahmadinejad, the fundamentalist ex-mayor of Tehran who was the surprise winner in last June's presidential election, is a populist.
He knows how to stir up the vast masses of working-class people who support him, by promising a better sharing out of Iran's wealth.
They adore it when he defies the great powers which Iranians traditionally believe have deliberately blighted Iran's prospects.
Why shouldn't Iran have nuclear energy if it wants, he asks, and (though he never quite says so) nuclear weapons too?
Large numbers of Iranians of all opinions and classes agree.
Why doesn't America just step in and stop it happening?
Because it cannot.
Iran is far too large and determined for US troops to invade; and if they did, Iraq has shown that fighting a guerrilla war is not America's forte.
President Bush said the stand-off was a "grave" concern for the US
President Bush could bomb Iranian nuclear and military and oil installations, but there would be outrage around the world, and American interests would be seriously damaged.
He could arm and support the Mujaheddin-e-Khalq insurgent group, which Saddam Hussein used to fund, and encourage it to blow up targets inside Iran.
But that would only strengthen the government in Tehran, and do further damage to America's standing in the world.
Is it true that a handful of religious extremists holds the entire population of Iran in thrall?
No. Iran is, within narrow limits, a kind of democracy.
President Ahmadinejad won his election fairly, even though no-one who opposed the basic structures of the Islamic Republic was permitted to stand.
A great many Iranians would certainly be delighted if the theocratic state collapsed, and all the restrictions on everyday life, great and small, came to an end; but a great many others support it passionately.
And if there were an attack on Iran, most Iranians would rally to their government's support.
Does President Ahmadinejad really want to wipe Israel off the map?
Certainly - if he could. But he and his government know it is impossible.
Despite its posturing, Iran is not a great military power. It has few of the logistical and strategic systems needed to threaten a distant country, and Israel is well-equipped to defend itself.
As for Mr Ahmadinejad's veiled threats to take revenge on the West for the pressure on his government, they are just rhetoric too.
Might Israel attack Iran's nuclear facilities?
It certainly took out Iraq's, back in 1981.
But Israel is more isolated than it was then, and the US would put a huge pressure on it not to do anything of the sort, for fear it might spark a wider conflict.
Still, if Israel believes its essential safety is sufficiently under threat, nothing will stop it taking action of some sort.
Will UN sanctions against Iran be effective?
No. Sanctions rarely damage a country's government, although they often hurt the poor and unprotected.
The Iranian president has given no ground in negotiations
Sometimes they even help the economy, since more things have to be manufactured at home.
Twenty-five years of US sanctions have had little effect on Iran, though they made life harder for its oil industry.
Since Iran has land borders with openly friendly Iraq and moderately sympathetic Turkey, Pakistan, Afghanistan and the Central Asian republics, and since Dubai is just a short plane or boat ride away, Iran will survive very well.
Oil prices will go up, and the US and Europe may well find that the confrontation with Iran will be expensive.
What will China and Russia do?
Both will try hard to water down the sanctions regime.
China's political ambition to be the dominant power in Asia will be boosted by this crisis.
Russia too will sympathise, but will tend to side more with the US and Europe.
So how will it all end?
Probably with the Americans and Europeans accepting Iran's status as a nuclear power, while trying to tie it up with as many controls as possible.
Some compromise may well be found, and Russia will be well-placed to negotiate one.
The West's main hope now is that President Ahmadinejad's critics and opponents within the Iranian political system - and there are plenty of conservative mullahs and wealthy merchants who don't like his brand of fiery populism - will work away to weaken him, and force him to accept a compromise.
But in the meantime some European governments are already worried that President Bush's advisers will see this crisis as a way of restoring his fortunes in time for the US mid-term elections in November.
Do you agree with John Simpson's views? What do you think of the Iran nuclear situation? Do you think Iran should be allowed to become a nuclear power? Send us your comments.