ABU DHABI, United Arab Emirates — Iran has had a turbulent past week, marked by more than a hundred Iranian deaths and dramatically increased tensions with the U.S. As it enters into the third day of protests fueled by popular anger over the government's handling of a downed passenger jet, some observers argue this is the most vulnerable the Islamic Republic's regime has been since its founding in 1979. Asked about the possibility of regime collapse, General James Jones, who was Obama's national security advisor in 2009 and 2010, said the risk for Tehran cannot be ignored. "I think the needle is moved more in that direction in the last year towards that possibility than ever before with a combination of the sanctions, relative isolation of the regime, and then some catastrophic decisions have been made — assuming that we weren't going to respond, which turned out to be a very, very bad decision," Jones told CNBC's Hadley Gamble at the Atlantic Council Global Energy Forum in Abu Dhabi on Sunday. The response Jones referred to was the U.S. drone strike that killed top Iranian general Qasem Soleimani on Jan. 3, a move that shocked the region and prompted a response from Iran in the form of missiles strikes on two military bases in Iraq that housed U.S. forces. No one was killed in the strikes. Washington says the strike was in response to the storming by Iranian-backed Iraqi militias of the U.S. embassy in Baghdad and purported threats cited by the White House of impending attacks on Americans.

"I think it's clear that the regime in Iran has had a very bad couple of weeks," Jones said. "And one of the things that people don't talk about too much is the degree of unrest that there is in the country, which I think is significant." "So you take the removal of Soleimani, you take the accidental downing of the civilian aircraft coupled with the amount of popular unrest — the needle towards possible collapse of a regime has to be something that people think about. It's probably not politically correct to talk about it, but you have to think about it." The Trump administration denies its goal with "maximum pressure" through sanctions is regime change, but its officials have admitted they don't expect Tehran to change its "malign behavior" anytime soon and some current and former administration officials have espoused regime change in past years.

'Death, death to the dictator'

More than a million people are estimated to have marched in the streets in Iran for three days of mourning over Soleimani, who was the architect behind Iran's expansion of influence in countries like Syria, Lebanon, Iraq and Yemen through proxy forces. It appeared to be a time of unity for many Iranians in support of their government and against the U.S. That appears to have been reversed after Iran had to admit its military accidentally shot down a Ukrainian passenger jet that killed 176 people, most of whom were Iranian, after several days of official denials. Iran's military said the "human error" happened amid "high tensions" as Iran was anticipating U.S. retaliation over its missile volley toward American targets in Iraq.

An Iranian man holds-up a placard as he attends in front of a University to mark the memory of the victims of the Ukraine Boeing 737 passenger plane in Tehrans business district on January 11, 2020. Morteza Nikoubazl | NurPhoto | Getty Images)

Thousands of Iranians are estimated to have protested the regime for the past three days and are now being met with live ammunition and tear gas from Iranian security forces, videos circulating online and verified by the Associated Press show. The protesters chants include "They are lying that our enemy is America, our enemy is right here" and "death, death to the dictator," in an apparent reference to Iranian supreme leader Ayatollah Ali Khamenei. Jones says that this, in addition to years of worsening economic conditions, exposes major weaknesses for the regime. November saw street protests in Iran in response to the government dramatically raising fuel prices, which ultimately saw a brutal crackdown with hundreds of protesters killed by security forces.

Crumbling economy

Iran's economy has been buckling under increasingly heavy U.S. sanctions imposed after the Trump administration withdrew from the 2015 nuclear deal. Inflation has surpassed 40%, according to the Statistical Center of Iran, unemployment is high and the economy is expected to contract more than 8% in the financial year 2019/20. But the control the state holds over the country remains high. Iran's Islamic Revolutionary Guard Corps (IRGC) and its paramilitary force, Basij, numbers around 250,000 and law enforcement personnel constitute an additional half million across the country, bolstering coercive power. These bodies were instrumental in putting down Iran's 2009 Green Movement, a student-led political revolt that saw scores killed by government forces. While the Trump administration is encouraging the protesters, regional watchers warn that rather than the government backing down, yet more violence toward civilians could ensue.

Anger toward the government among many in Iran far pre-dates the Trump administration. Beyond sanctions, Iran's economy is further handicapped by its own authorities, who have allowed gaping infrastructure deficiencies, a weak banking sector and widespread corruption. But some former security officials doubt the Trump narrative that maximum pressure will neuter the regime through internal discontent and unrest. Two former Middle East advisors under the Obama administration wrote in in Foreign Policy last month: "The biggest immediate risk is to the Iranian people themselves. Iran's history and its actions during the current crisis leave little doubt that the regime will stop at virtually nothing to remain in power."

Killing Soleimani 'a powerful step'