Tough new oil-based sanctions should force Iran back to the negotiating table, William Hague has said after the UK indicated it could increase its military force in the Gulf if the situation escalates.
The Foreign Secretary stressed that Britain did not want to resolve the dispute over Iran's nuclear ambitions by force, despite threats by Tehran to block a key shipping route.
A European Union-wide block on imported Iranian oil agreed on Monday was designed "to lead us away from any conflict by increasing the pressure for a peaceful settlement of these disputes", he said.
But, responding to fears raised in the Commons by Conservative MP Robert Halfon that war looked "increasingly likely", he acknowledged that all options remained on the table.
Mr Hague was called by the Speaker to update MPs on the latest developments just hours after Defence Secretary Philip Hammond said military reinforcements were available if required.
At the weekend, HMS Argyll sailed alongside American and French warships through the sensitive Strait of Hormuz in what Mr Hammond said sent a "clear signal" to the regime. Iran has threatened to close the strait - through which 35% of the world's tanker-borne oil exports pass - in retaliation for the sanctions against its oil exports.
Asked if more resources could be sent, Mr Hammond said: "The UK has a contingent capability to reinforce that presence should at any time it be considered necessary to do so."
He was speaking at a press conference in London following the annual round of talks between UK and Australian foreign and defence ministers. Australia's foreign minister Kevin Rudd said his country would enforce the same ban on Iranian crude oil exports agreed by the EU on Monday.
Mr Hague said in the Commons: "This is not a set of actions designed to lead to any conflict but to lead us away from any conflict by increasing the pressure for a peaceful settlement of these disputes."
However, he added: "We have many contingency plans for many contingencies, including ... for sending any further naval forces to that area. But we are not planning to take military action in the Gulf. We call on Iran to return to the negotiations which are at all times available to it."