While nearly all the international attention regarding the Iranian nuclear program has been devoted to a potential Israeli strike, a possible conflict has been brewing much closer to Iran's borders, and could now be reaching boiling point.

Yesterday and today, the Peninsula Shield Force, the military coordinating army of the Gulf Cooperation Council (GCC), which is essentially the NATO of the Sunni countries around the Persian Gulf, carrying out a war-game titled "Islands of Loyalty." While there are few official details of the exercise which is meant to "test the harmony and coordination among ground, air and naval forces and their readiness," the name is certainly no coincidence.

The islands to which they are swearing loyalty are the tiny Abu Musa and Greater and Lesser Tunb islets, near the mouth of the Straits of Hormuz, that Iran seized in 1971 when the British forces left the region. They have since been a bone of contention with the UAE, which claims sovereignty over them. While the dispute has lain dormant for most of the decades since, in the last two months, the UAE has been mounting increasingly vocal demands for the return of their territory with the backing of the GCC and the Arab League.

This of course has brought an an angry response from the Iranians who vowed to "crush any act of aggression" against what they see as their territory and a visit to Abu Musa Island by President Mahmoud Ahmadinejad a few weeks ago.


Why have the islands suddenly become an issue for the Emirates after 41 years ? It is almost certainly a pretext for much wider concerns on behalf of the Gulf States leaders. Not only are they just as worried as Israel - if not more – over the implications of a nuclear-armed Iran, they are already dealing with increasing threats to their stability. In addition to Iran, they now have its neighbor Iraq, under the intransigent Prime Minister Nuri al-Maliki as a Shia-dominated Iranian ally, which emboldens the sizable Shia minorities in Saudi Arabia, Kuwait, the UAE and Qatar. And of course, one of their club-members, Bahrain, is two-third Shia and still undergoing a low-key uprising against its Sunni rulers.

Last year, when 2000 Saudi and UAE troops entered Bahrain to assist the King's forces in putting down the riots, they did so under the umbrella of the Peninsula Shield Force. In effect, the force proved itself as an instrument of Sunni hegemony in the region, and the exercise this week should be seen as another demonstration of Sunni power towards Iran. The Gulf's kings and emirs are convinced that Iran is seeking to harness the forces unleashed by the Arab uprisings to destabilizing their control over their fiefdoms and rather than wait for events to overtake them – use the islands dispute as a lever to ramp up their deterrence towards Iran.

While analysts do not believe that the Gulf countries would go as far as to risk outright war with Iran, it would be useful to remember that not for nothing have the two main Sunni Gulf states, Saudi Arabia and the UAE, built up huge air forces fielding hundreds of front-line American, British and French fighter jets (U.S. General Petraeus said a couple of years ago that "the Emirati Air Force itself could take out the entire Iranian Air Force"). And if that's not enough, the United States seems to have found the best timing to station a squadron of F-22s, the most advanced warplane in the world, at Al-Dhafra airbase in the UAE, joining the spy planes and aerial tankers of the 380th Air Expeditionary Wing already based there, just across the Gulf. Iranian Defense Minister Brigadier General Ahmad Vahidi was quick to denounce the deployment as "a harmful move that undermines the security of the region" - and he should know.

While the Gulf States are not yet going to war, they have alternative channels to pile pressure on Iran. One option they are certainly exercising is increasing their support to the opposition groups fighting the Iranian-backed Assad regime. Tariq Alhomayed, the editor-in-chief of Asharq al-Awsat, which represents the Saudi government's current thinking, strenuously advocated such a course two weeks ago.

But as the Saudis, Emiratis and Qataris try to channel their frustration with Tehran toward Syria, they will almost certainly provoke Iran's attempts to intensify the challenge within the Gulf.