How will Iran respond to Soleimani's killing?

Khamenei may decide to go big with an attack on U.S. soil, or against Americans abroad. Certainly U.S. ambassadors and government officials abroad will now have their security increased against the threat of retaliatory assassination. Iran might also consider some kind of escalation in the Persian Gulf, perhaps disrupting oil tanker transits through the Strait of Hormuz. The Iranians would hope that such action might earn international ire for Washington. These options pose real complications, however. Though much of the focus of the U.S. media has been on the potential blowback to America, Iran has much more to lose from a major escalation.

For a start, if Iran attempts to shut the Strait of Hormuz, its navy will end up at the bottom of the Persian Gulf. And with Iran’s economy crippled by U.S. sanctions and domestic protests bubbling very near to the surface, Khamenei can ill afford a serious confrontation with America. Doing so would risk the regime itself. Note also that Trump’s oscillation from a harsh policy towards Iran, to stated interest in high level diplomacy, to this killing of its most revered officer will foster another Iranian fear: if we push him too far, what is Trump capable of?