Iran will close the Strait of Hormuz, cutting off oil exports, if the West imposes sanctions on its shipments, a senior Tehran official has said.
Vice President Mohamed Reza Rahimi said Iran does not want hostilities but charged that the West continues its plots against Iran, according to the Iranian official news agency IRNA.
Iran is conducting 10-day naval manoeuvres in the area of the Strait of Hormuz, where about 40% of the world's oil supply passes. Closing the strait would have immense world economic impact.
The West is considering limiting Iran's oil trade over its disputed nuclear programme. Some 80% of Iran's foreign revenue comes from oil exports.
In Washington, US State Department spokesman Mark Toner called the threat "bluster".
He said it was "another attempt by them to distract attention from the real issue, which is their continued non-compliance with international nuclear obligations".