The recent confrontation between Ahmadinejad and Supreme Leader Ayatollah Ali Khamenei involved the president’s dismissal last month of the country’s most powerful intelligence chief, Heidar Moslehi.
Khamenei quickly reinstated Moslehi in a slap to Ahmadinejad. In apparent protest, the president skipped two Cabinet meetings this past week.
Ahmadinejad’s decision to back down and attend is likely an attempt to avoid backlash from Khamenei, who has been a strong supporter of the president. That relationship could be fraying by Ahmadinejad’s repeated attempts to push the limits of his powers.
Last week, Khamenei made a rare public rebuke to Ahmadinejad, saying he will not hesitate to intervene in government affairs whenever necessary.
A serious fall from Khamenei’s favor would leave Ahmadinejad’s clout seriously diminished and test the loyalty of his main supporters, including the Revolutionary Guard that will have a central role in picking the candidates for his successor in 2013.
The Tehran Stock Exchange lost 6 percent in value over the last three trading days due to the political uncertainty. Without the supreme leader's support, any Iranian president risks becoming a lame duck.
Ahead of Sunday's Cabinet meeting, the head of national broadcaster IRIB told news agencies that Ahmadinejad would express his allegiance to Khamenei.
"His speech to the Cabinet today will foil all the plots of the enemies of Islam and the revolution and will show that enemies of the Iranian nation are not able to comprehend his father-son relation with the revolution leader (Khamenei)," the semi-official Fars news quoted Ezatollah Zarghami as saying.
Some members of Parliament had called on Saturday for a closed session to discuss Ahmadinejad's apparent refusal to attend his own Cabinet meetings.
"When the president is not around it's something natural in any country," one share dealer said, saying people were concerned about Ahmadinejad "not going to work.” Fars news agency said the share slide was due to "day to day political issues and some other issues.”
The president has many critics on the right who accuse him of seeking more power for himself at the expense of other state bodies such as Parliament.
Many conservative clerics have also criticized his closest aide, Esfandiar Rahim-Mashaie, for promoting an "Iranian school" of Islam, which they consider a dangerous nationalistic stance.
The jostling for influence is happening less than one year before a parliamentary election set to be a battle among fellow conservatives. Leading reformist candidates are unlikely to be allowed to stand if they are deemed too close to the opposition "Green" movement, which the establishment considers to be part of a foreign-backed conspiracy to overthrow the Islamic system.
