WASHINGTON—Iranian intelligence agents were conducting intensive surveillance of American military personnel and facilities in Saudi Arabia at least a year before the bombing of a U.S. military housing complex…, according to U.S. officials.

While the evidence of Iranian intelligence surveillance does not tie Iran's Islamic regime directly to the Khobar Towers blast, the information further fuels questions about why Clinton administration officials have appeared skeptical of Saudi Arabia's assertions of Iranian complicity…

U.S. military and intelligence officials became convinced that the surveillance was part of Iran's contingency planning for possible terrorist strikes against U.S. personnel and facilities in Saudi Arabia, officials said…

Some critics within the U.S. government complain that the administration has taken an overly legalistic approach to searching for Iranian ties to the attack. Clear proof of Iranian complicity might pressure the administration to take retaliatory measures against Iran...

Iran Leader Asks Hizbollah to Boost Recruitment, Reuter, October 14 

TEHRAN-—Iran's supreme spiritual leader Ayatollah Ali Khamenei on Tuesday urged Lebanon's pro-Iranian militant Islamic group Hizbollah to recruit more fighters in its struggle against Israel, state-run Tehran radio said…

Speaking to visiting Hizbollah secretary-general Sheikh Hassan Nasrallah, Khamenei said "the downfall of the usurper state of Israel is in the nature of divine law," it said…

"All the forces of world arrogance (the West) have been mobilized to complete the so-called Middle East peace talks but, despite this, the power of God changed the course of events," Khamenei said.

[Meanwhile the regime's news agency, IRNA, reported: … Akbar Hashemi Rafsanjani here on Wednesday received the visiting secretary general of Lebanon's Hizbullah…

[Nasrullah appreciated the support of the Islamic republic of Iran for the struggle of the Lebanese and Palestinian peoples and briefed Rafsanjani on the latest developments in southern Lebanon…]

Iranians Still Warily Await Reforms, New York Times, October 11 

TEHRAN— …In fact, more than four months after the fact, the landslide victory by Khatami on May 23 appears only to have clouded the question of where power lies in Iran….

"All we can say now is that Khatami has complicated rather than clarified the balance of power in this country," a senior Western diplomat said. "You already had several centers of power, and the election of Khatami has created a new center of power without replacing any of the old ones."

For now, it is impossible to know how far even Khatami would like to carry his own vague quest for change. He resigned in protest from a previous Iranian government, but he is an outsider only by Iranian standards.

He has never questioned the basic premise of the system: that the supreme leader should not be chosen by the people but anointed by a panel of clerics to be God's representative on earth…

Until his death, Khomeini reigned as Iran's single all-powerful force. Then came a period of dual leadership in which Khamenei, who had been president, became the supreme leader, and Hashemi Rafsanjani, the speaker of Parliament, took over as president…

As supreme leader, Khamenei remains commander of the armed forces. Since the election, he has also asserted control over the national police force, which under Rafsanjani reported to the Interior Ministry.

And Khamenei controls the state radio and television, which have infuriated Khatami's supporters by referring to him in the singular in Persian, rather than in the plural form used to connote respect.

At the same time, many of the Cabinet ministers ousted by Khatami have been given jobs as advisers to the supreme leader, forming a kind of shadow government. And Khamenei has put Rafsanjani in charge of a panel known as the Expediency Council and granted it considerable power -- so much that most diplomats and Iranian political analysts regard the former president, and not the current one, as the country's second-most-powerful person.

"It's getting awfully crowded at the top," a Western diplomat said, describing what now appears to be at least a troika of power…

But many people who admit to being caught up in the euphoria of Khatami's election say they have begun to worry in recent weeks. They say they wonder whether he will be seen in the end as having served as a pressure valve that allowed Iranians to let off steam, or a pressure cooker that built up new resentments.

"I'm not as optimistic as I was before," said a Tehran literary figure who supported Khatami... "This is the first time that we have come to learn how powerless a president can be."

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