Iran’s threat to close the Strait of Hormuz to international shipping if the US and European Union press ahead with fresh sanctions against Tehran is being dismissed by western diplomats, who argue that such a move would end up further crippling the beleaguered Iranian economy.

However, Iran’s tough rhetoric also signals how tense diplomatic relations between Iran and the west could become over the next few weeks as the US and EU move to impose sanctions which for the first time will significantly affect the country’s oil sector.

Earlier this week, Mohammad Reza Rahimi, Iran’s first vice-president, warned that the country would not allow “even one drop of oil” to flow through the strait should the west impose oil sanctions on Tehran.

His comments caused the price of oil to briefly spike, amid concerns that one-sixth of the world’s oil production passes through this neck of the Persian Gulf and that closing it off could throttle the global economy

In London, the Iranian vice-president’s comments are been dismissed by diplomats. “Our judgment is that while the Iranians are proving unpredictable, they would not carry through such a threat,” said a UK diplomat. “It is not in their interests economically and politically and would isolate them still further in the international community.”

Other western diplomats also take the view that a move to close off the strait of Hormuz would create serious international tensions and would be hard to imagine. In their view, Iran is not in a position militarily to undertake such a confrontation, which would almost certainly meet retaliation at sea from the US and other states in the region.

Despite this, western states are well aware that the next few weeks will see a heightening of the war of words between Iran and the west as the US and EU are on the verge of a significant escalation of sanctions against the Iranian nuclear programme – one which will for the first time affect the real Iranian economy.

In Washington, President Barack Obama is preparing to sign legislation that penalises foreign companies that do business with the Central Bank of Iran and could substantially reduce Iran’s oil revenue.

Amid the rising tensions with Tehran, the Obama administration said on Thursday it would sell nearly $30bn of F-15 fighter jets to Saudi Arabia, confirming the main part of a $60bn arms package initially announced last year which is aimed at countering Iranian influence in the region.

“This agreement serves to reinforce the strong and enduring relationship between the United States and Saudi Arabia. It demonstrates the US commitment to a strong Saudi defence capability as a key component to regional security,” said Andrew Shapiro, an assistant secretary of state.

The EU, meanwhile, is set to ban all oil imports from Iran by its 27 member states. Iran exports 18 per cent of its oil to the EU and a European ban could significantly reduce Iranian foreign currency reserves.

The sanctions drive comes in the wake of a damning report into the Iranian nuclear programme that was published last month by the International Atomic Energy Agency, the UN watchdog. This has suggested that Iran has sought in the past to use its nuclear programme to make an atomic weapon.

Iran is one of the world’s biggest oil exporters and as they press ahead with sanctions, the US and EU will want to ensure that their moves do not trigger a jump in the price of oil. One of the core tasks facing the EU as it prepares to impose sanctions is to make sure that Arab nations supply southern European states that rely on Iranian oil, such as Greece and Italy.

Despite the belief of some diplomats that Iran will not retaliate irrationally against fresh sanctions, others have concerns. In recent weeks, the Iranian regime has permitted the ransacking of the British embassy in Tehran.

Iranian groups were also at the centre of an alleged plot to assassinate the Saudi ambassador to the US. Both events have fuelled the view among some diplomats that the Tehran leadership is becoming increasingly unpredictable.

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