Tension at new high as Iran vows to punish West

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Tehran threatens to close Straits of Hormuz if US enforces an embargo

They buried a young scientist called Mostafa Ahmadi Roshan in Tehran on Friday. And if the hazardous carousel of attacks, embargoes and official threats does not slow down soon, there could be other bodies and hopes wrapped in a sheet and put into the ground. Many more young men, peace in the Straits of Hormuz and beyond, and supplies of oil at an affordable price could all be as dead as the assassinated Roshan if the crisis over Iran's nuclear project ratchets up further.

The United States, trying to put pressure on Tehran over its nuclear programme, is pressing for a worldwide embargo on sales of oil from Iran, the world's second-largest supplier. Iran says it would then order its navy to close the Straits of Hormuz, through which 40 per cent of global oil passes. The White House response is that this would be the "crossing of a red line", which would be met with armed response. Britain agrees and has despatched HMS Daring to the area. Yesterday, a semi-official Iranian news agency said Tehran would punish "behind-the-scene elements" involved in Roshan's death. This weekend tensions are as high as they have been in a long while.

The US and Israel are not alone in believing that Iran's nuclear work is designed not, as Tehran maintains, purely for energy supply, but so the Shia state has a weapons capacity. A week ago, the International Atomic Energy Authority (IAEA) confirmed that Iran was now enriching uranium to 20 per cent, a level more appropriate to weapons than energy supply. And, in November, the IAEA issued a document drawing on 1,000 pages of intelligence which said for the first time that some of the alleged experiments can have no other purpose than developing nuclear weapons. On 28 January, a senior UN nuclear agency team will visit Tehran to discuss allegations that Iran is involved in secret nuclear weapons work.

President Barack Obama approved new sanctions last month that would target Iran's central bank and its ability to sell petroleum abroad. The US has delayed implementing the sanctions for at least six months, worried about sending the price of oil higher at a time when the global economy is struggling. The attempts to embargo Iranian oil sales have met a frosty reception in China, and a pretty cool one in Japan and India. European Union foreign ministers are expected to agree to a ban on imports of Iranian crude oil on 23 January. However, even Europe, whose governments largely share the concerns of Israel and Washington over Iran's nuclear ambitions, is looking for ways to limit the pain of an embargo. Firms in Iran's three biggest EU oil customers, Italy, Spain and Greece, all suffering economic pain, have lately extended existing purchase deals in the hope at least of delaying the impact of any embargo for months.

Meanwhile, in Tehran, the anger on show at the funeral of Mostafa Roshan, when thousands screamed "Death to Israel! Death to America!", grows. Yesterday, Iran's official news agency, IRNA, said the country was holding Britain and the US responsible for the assassination. Tehran has now sent two separate diplomatic notes to London and Washington, in which it claimed that both countries had an "obvious role" in the killing of Roshan. It has previously accused Israel's Mossad, the CIA and Britain's spy agency of engaging in an underground "terrorism" campaign against nuclear-related targets, including at least three killing since early 2010 and the release of a malicious computer virus known at Stuxnet in 2010 which temporarily disrupted controls of some centrifuges – a key component in nuclear fuel production. All three countries have denied the accusations.

Like other Iranian scientists working on Iran's nuclear programme before him, Roshan was killed by a magnetic bomb placed on his car by two men on a motorbike. Tehran swiftly said the assassins were working for Israel, with President Ahmadinejad declaring: "Once again the dirty hands of arrogance and the Zionist elements have deprived our scientific and academic community of the graceful presence of one our young intellectuals."

While assassination by opponents of the Tehran regime is the most obvious explanation, opposition groups or internal saboteurs cannot be ruled out. And the defections of at least two prominent Iranian nuclear scientists raise the question of whether some of the killings might be an inside job, aimed at those thought to be actually, or potentially, disloyal – with the added benefit of being carried out in a way that deflects blame abroad. Unlikely perhaps, but not impossible.

The Israelis, as ever, are relaxed about being blamed, as they were in the case of the other assassinated Iranian scientists. In an interview on Friday with CNN Spanish, Shimon Peres, Israel's President, said that "to the best of my knowledge" Israel was not involved in the hit on Roshan. Given the longevity of Mr Peres's intimate connection with Israel's defence establishment, his words carry some weight. But his remarks were limited to this one assassination out of several – successful and unsuccessful – attempts on the lives of scientists connected with Iran's nuclear programme.

There is little doubt that Israel has worked covertly in the past, along with the US, to perpetrate some of what the IDF Chief of Staff, Benny Ganz, making predictions about what might happen in 2012, reportedly described last week as "unnatural events". And not always in co-operation with the US. A new and apparently well-sourced report in Foreign Policy describes how, to the vexation of the Bush administration and US intelligence, Mossad agents using US passports posed as CIA operatives, mainly in London, and sought to recruit members of the Pakistani Sunni extremist organisation Jundallah during 2007-08 to carry out anti-regime operations inside Iran.

The assassination, whoever carried it out, was obviously aimed at delaying and harrying Iran's nuclear programme, but such killings certainly will not stop the programme or bring Iran to the negotiating table. And security officials think time is running out. They believe Iran will pass the technological threshold for producing nuclear weapons – the "point of no return" – later this year, and that they will be able to develop an actual weapon within two or three years.

Hence the raising of stakes by both sides. The hope is that, amid the brinkmanship, some diplomatic way through is found. In remarks made in an interview with The Weekend Australian and released on Friday night, Israel's Prime Minister, Benjamin Netanyahu, broke – for him – new ground by declaring that sanctions were actually working. "For the first time, I see Iran wobble under the sanctions that have been adopted and especially under the threat of strong sanctions on their central bank," he declared. "If these sanctions are coupled with a clear statement by the international community, led by the US, to act militarily to stop Iran if sanctions fail, Iran may consider not going through the pain. There's no point gritting your teeth if you're going to be stopped anyway."

If nothing else, the interview implied that the Prime Minister believes that Israel's refusal to rule out a military strike has had, as he would see it, a positive impact on the international community's willingness to impose genuinely tough sanctions. The alternative to them working is not a good one. Sanctions, like covert operations, are not a mutually exclusive alternative to war, of course; indeed, they can exacerbate the tensions that then lead to war. But, for now, those wanting to avoid a conflagration in the Middle East have to hope that Mr Netanyahu's new, if cautious, expressions of faith in them are both genuine and sustained.

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