Iran has been given a fortnight to agree to freeze its uranium-enrichment programme or face further international isolation.
Oil leapt to a new record high near a barrel on Friday, spurred by growing worries of threats to supplies from Iran and Nigeria.
Oil prices rose further on Friday amid tensions over crude producer Iran and at the end of an extremely volatile week of trading.
Iranian scientists are working to master the intricacies of nuclear and missile technology. Less successful are Iranian attempts to master Photoshop.
The United States will defend its allies against Iranian aggression, US Secretary of State Condoleezza Rice said on Thursday.
Iran showed footage of missiles on Wednesday it warns could reach US bases in the region, but analysts say the damage they could wreak is limited.
Iran has test-fired nine long- and medium-range missiles, including one which it has previously said could reach Israel and US bases in the region.
Iran says it will hit Tel Aviv, US shipping in the Gulf and US interests around the world if it is attacked over its disputed nuclear activities.
Iran’s army chief warned on Saturday that the Islamic republic would shut the Strait of Hormuz if its interests were threatened.
Iran vowed on Saturday to pursue its uranium enrichment programme, a day after delivering its response to an incentives package.
Iran responded on Friday to an incentives package offered by six world powers aimed at resolving a stand-off over its disputed nuclear ambitions.
The head of Iran’s elite Revolutionary Guards has warned that any Israeli or US attack on its nuclear sites would mean the outbreak of war.
Iran is keeping the world guessing about its response to the latest offer to suspend its nuclear programme in return for international incentives.
Iran has warned of a fierce response and higher oil prices if attacked, but also signalled possible progress in a nuclear stand-off with the West.
Iran’s Revolutionary Guards warned the United States on Wednesday it would face a ”tragedy” if it attacked the Islamic Republic.
Oil rose for a third straight session on Tuesday to more than a barrel, boosted by a rumoured attack on Iran’s nuclear facilities.
Iran President Mahmoud Ahmadinejad accused the US and its allies of plotting to assassinate him during a visit to Iraq, radio reported on Friday.
A nuclear deal proposed by the major powers appeared on Sunday to have widened rifts among Iran’s ruling conservatives.
Top EU diplomat Javier Solana handed Iran an offer by six major powers to try to coax it into halting nuclear work, but Tehran ruled out suspension.
Top European Union diplomat Javier Solana will present Iran with a major powers’ offer of trade and other benefits on Saturday.
World crude prices are expected to reach per barrel by the end of summer, Iran’s representative to the Organisation of the Petroleum Exporting Countries (Opec) was quoted as saying on Sunday.