The Iranian government is bracing itself for a fresh US and Israeli missile assault after it was announced that the US Abraham Lincoln aircraft carrier strike group has now deployed key assets to the region, observers have said.

It is thought that Washington has the firepower in conjunction with Israeli aircraft to mount an attack designed to topple the government accused of brutally suppressing protests and killing thousands of Iranians.

The US fleet including several guided-missile destroyers are not yet in final position but are already in striking range of Iran. It is by no means certain that further US attacks on Iran will reignite the street protests, as many Iranians opposed to the clerical leadership in power since 1979 are also opposed to externally imposed regime change.

With no signs of a diplomatic breakthrough imminent, the Iranian stock market suffered a record daily fall on Monday. Regional powers including the United Arab Emirates declared they will not allow their airspace or territorial waters to be used to mount an attack on Iran but the presence of the carrier strike group in the Mediterranean means permission will not be needed from many third parties for an attack. Over the weekend, the US military announced that it would carry out an exercise in the region “to demonstrate the ability to deploy, disperse, and sustain combat airpower”.

Any such attack will not be designed to weaken Iran’s already shattered nuclear programme, the chief target of the 12-day war in June, but to target Iran’s political leadership and bring the protesters angered by falling living standards back into the streets. Inflation in the last month reached 60%, new official figures showed.

Ali Larijani, the secretary of Iran’s supreme national security council, claimed the US was trying to destroy Iran’s social cohesion before an attack. He said Donald Trump’s effort to portray “the country as being in a state of emergency is itself a form of warfare, and this is exactly what the enemies are seeking to achieve. The rioters constitute an urban group with terrorist-like characteristics. When they rush toward military and police centres to obtain weapons, it indicates that they are seeking to provoke a civil war. This time, the US tactic is to first break public cohesion and only then carry out a military attack.”

Iran’s foreign ministry spokesperson, Esmail Baghaei, speaking at his weekly press conference said it was a lie to suggest that the US special envoy, Steve Witkoff, was in touch with the foreign minister, Abbas Araghchi, to discuss a possible diplomatic deal.

Witkoff has recently been raising his demands to include the return of UN weapons inspectors, the removal of all Iranian highly enriched uranium and curtailment of Iran’s missile programme.

Baghaei added that Iran’s armed forces are “carefully monitoring every movement” and warned that sending forces and making threats “goes against the principles of the international system” and threatened that “if these principles are violated, insecurity will befall everyone”. He then said “we will give a comprehensive and regrettable response to any aggression”.

Gholam-Hossein Mohseni-Ejei, the chief justice, called for Iran not to return to the negotiating table.

Trump held off from an attack on Iran a fortnight ago in the midst of the protests fearing he had not been offered decisive options to remove the Supreme Leader Ayatollah Ali Khamenei from power or a detailed battle plan for how Israel would be protected from Iranian reprisals. Many Iranians resent Trump’s failure so far to hold good on his promise to come to the help of the protesters. The US administration remains divided whether to push for what amounts to regime change in a country of 90 million people.

Estimates of the death toll continue to vary massively but one of the most respected human rights groups, the Human Rights Activists news agency, said the number of deaths of protesters had reached 5,419. The group was still investigating a further 17,000 fatalities.

United Nations special rapporteur on Iran, Mai Sato, who is also a professor at Birkbeck in London, said she could not verify the figures. She claimed families were facing demands for ransoms of $5,000 to $7,000 to retrieve the bodies of loved ones, a claim denied by the Iranian government, Internet access has been throttled since 8 January, and the communications department said business could not tolerate an outage for more than 20 days.

In Europe the Italian foreign minister, Antonio Tajani, said he would be recommending to the EU foreign affairs council the Islamic Revolutionary Guards Corps be labelled a proscribed organisation in Europe.