WASHINGTON // Iran wants a diplomatic solution to its stand-off with the international community over its nuclear programme, but does not want to compromise over its core interests, according to the US military, even as Tehran yesterday again threatened to close the Strait of Hormuz and not allow " a single drop of oil" to pass.
Tehran will increase its military presence in international waters, said Ali Fadavi, naval commander in Iran's elite Islamic Revolutionary Guard Corps (IRGC), yesterday, in response to tightening international sanctions and reports of an increased US navy presence in the Gulf.
"If they (the US) do not obey international laws and the IRGC's warnings, it will have very bad consequences for them," Cmdr Fadavi said, according to Iran's Fars News Agency.
"The IRGC's naval forces have had the ability since the (Iran-Iraq) war to completely control the Strait of Hormuz and not allow even a single drop of oil to pass through."
"This IRGC naval force presence in international waters will increase."
A Pentagon report to the US Congress about Iran's military capabilities that was declassified last month but only reported this week, concludes that while Tehran does not want to compromise on its core principles, it does want a diplomatic solution.
The report also found that Iran continues to develop technologies "applicable" to nuclear weapons, is engaged in uranium enrichment in defiance of UN resolutions, and has boosted the "lethality" of its ballistic missile systems.
In the event of a military confrontation or an attempted invasion, it is Iran's unconventional forces that the US military worries most about.
"Iran's unconventional forces are trained according to its asymmetric warfare doctrine and would present a formidable force while defending Iranian territory," the authors write.
The report defines Iran's unconventional forces as its support for groups such as Hamas, Hizbollah, Iraqi Shiite groups and the Taliban, which could cause a regional response to any attack on it.
Some suggest a military confrontation is all but inevitable as diplomacy stalls, international sanctions bite deeper and the military build-up on both sides continues.
On Thursday, the US treasury department announced sanctions against 11 companies, 20 Iranian financial institutions, and several individuals US officials said were either involved in furthering Iran's nuclear programme or circumventing existing sanctions.
The list of companies include two with offices in the UAE - International General Resourcing FZE and Good Luck Shipping - as well as companies based in Switzerland, Hong Kong and Malaysia.
On Wednesday the Los Angeles Times reported that the US navy was deploying underwater drones in the Gulf to target Iranian mines that might disrupt traffic through the Strait of Hormuz.
Iran has repeatedly threatened it would close the strait - through which about 20 per cent of the world's oil is shipped - in response to the ever-harsher sanctions being imposed on the country because of its nuclear programme.
Iran says it is developing nuclear power solely for peaceful use. The international community, led by the US, believes Tehran wants to develop nuclear weapons.
Diplomatic efforts through the P5+1 countries - the UN Security Council's permanent five members and Germany - continue but have made little headway.
Iran's nuclear programme is widely seen as a matter of national sovereignty in Iran, even among opposition parties and leaders. Iran's leadership had long ago concluded that nuclear weapons were essential to ensure the survival of the regime, said Roby Barrett, a Gulf security expert with the Middle East Institute, a Washington-based think tank.
Mr Barrett said the Iranian leadership sees nuclear weapons as being crucial to the country's national interest.
"Iran would not now be going through what it is going through - that's how Tehran sees it - if Iran had nuclear weapons," he said.
With little room for manoeuvre, chances of finding diplomatic common ground are remote.
Israel's position, that the mere Iranian ability to build a bomb, not the actual existence of nuclear weapons, would trigger Israeli military action, has effectively pushed any strategy of containment off the table.
Barack Obama, the US president, also ruled out the idea in a speech to Aipac, the powerful pro-Israel lobbying group, this year, where he said the US would do everything possible to prevent an Iranian nuclear capability.
"Sanctions are the last-ditch effort to prevent military action and force a diplomatic dialogue that will bring real concessions from the Iranians," said Mr Barrett.
If Iran is unwilling to budge on what it sees as its core interests, as the Pentagon predicts, there is a "real possibility" of military action, said Mr Barrett.
If it goes down that road, he said, the US should "not make the mistake we have made before of thinking this is going to be simple and easy".