• Iran's Islamic Revolutionary Guard Corps seize the Stena Impero ship
• Germany and France also urged Iran to release the tanker
• 'Friday's incident only goes to show what I'm saying about Iran: trouble. Nothing but trouble': Trump

Britain on Saturday urged Iran to de-escalate tensions in the Gulf by releasing a UK-flagged ship it said had been illegally seized in Omani waters in an "utterly unacceptable" gambit.

Tehran was defiantly ignoring mounting European appeals to free the captured oil tanker and its mostly Indian crew, as the United States prepared to redeploy troops to Iran's regional arch-rival Saudi Arabia.

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Iran's Islamic Revolutionary Guard Corps (IRGC) said it seized the Stena Impero ship on Friday for breaking "international maritime rules" in the Strait of Hormuz, a Gulf choke point for about a third of the world's sea-borne oil.

The oil tanker was impounded off Bandar Abbas port for allegedly failing to respond to distress calls and turning off its transponder after colliding with a fishing vessel, Iranian authorities said.

Britain's Foreign Secretary Jeremy Hunt leaves 10 Downing Street on Saturday.

It came hours after a court in the British overseas territory of Gibraltar said it would extend by 30 days the detention of the Grace 1 Iranian tanker seized by British authorities in the Mediterranean two weeks ago on allegations of breaching EU sanctions against Syria.

"They see this as a tit-for-tat situation," British Foreign Secretary Jeremy Hunt said following talks with his Iranian counterpart Mohammad Javad Zarif and a meeting of the UK's emergency response committee.

"Nothing could be further from the truth."

Hunt said that while the Grace 1 had been detained legally, "the Stena Impero was seized in Omani waters in clear contravention of international law. It was then forced to sail into Iran. This is totally and utterly unacceptable."

Germany and France urged Iran to release the tanker, whose seizure Berlin called a "dangerous further aggravation of an already tense situation."

The European Union voiced "deep concern".

US President Donald Trump said Friday's incident "only goes to show what I'm saying about Iran: trouble. Nothing but trouble."

But Iran remained defiant.

Zarif said Iran's actions were taken to "uphold" international maritime rules.

"It is Iran that guarantees the security of the Persian Gulf & the Strait of Hormuz. UK must cease being an accessory to #EconomicTerrorism of the US," he tweeted.

Iranian oil tanker Grace 1 as it sits anchored after British Royal Marines seized it earlier this month. File photo/Reuters

Later on Saturday, NATO's spokesman joined calls condemning Iran's move, saying it was a "clear challenge to international freedom of navigation". It said all NATO allies were concerned by "Iran's destabilising activities".

Footage released

Tensions in the Gulf have soared since May, with Trump calling off air strikes against Iran at the last minute in June after the Islamic republic downed a US drone.

The United States has also blamed Iran for multiple attacks on tankers in the Gulf.

Iran said it had opened an investigation on Saturday into the newly-seized tanker.

The IRGC released footage allegedly showing the capture operation.

Filmed from a ship and a helicopter, it shows small craft sailing alongside the ship, troops in balaclavas inside a chopper, and six people descending down a rope onto the vessel.

This image grab taken from a video shows Iranian troops wearing ski masks are seen on board a helicopter flying over the tanker.

Owned by Swedish operator Stena Bulk, the tanker's crew of 23 consists of 18 Indians, three Russians, a Latvian and a Filipino.

New Delhi, Manila and Riga said they were in touch with Tehran to seek the release of their nationals.

Stena Bulk said its insurers had been in contact with the head of marine affairs at Bandar Abbas, who reported that the crew were in "good health".

A formal request is being prepared for a visit to the crew.

The head of marine affairs "confirmed to them that no instructions have been received so far as to what will happen to the ship".

Iran releases video of capture

Britain on Saturday denounced Iran's seizure of a British-flagged oil tanker in the Gulf as a "hostile act" and rejected Tehran's explanation that it seized the vessel because it had been involved in an accident.

This image grab taken from a video shows a British-flagged tanker Stena Impero in the Strait of Hormuz. AFP

Iran's Revolutionary Guards posted a video online showing speedboats pulling alongside the Stena Impero tanker, its name clearly visible. Troops wearing ski masks and carrying machine guns rappelled to its deck from a helicopter, the same tactics used by British Royal Marines to seize an Iranian tanker off the coast of Gibraltar two weeks ago.

Friday's action in the global oil trade's most important waterway has been viewed in the West as a major escalation after three months of confrontation that has already taken Iran and the United States to the brink of war.

It follows threats from Tehran to retaliate for Britain's July 4 seizure of the Iranian tanker Grace 1, accused of violating sanctions on Syria.

Extreme disappointment

"Just spoke to ... Zarif and expressed extreme disappointment that having assured me last Saturday Iran wanted to de-escalate situation, they have behaved in the opposite way," Hunt wrote on Twitter. "This has to be about actions not words if we are to find a way through."

Earlier he said London's reaction would be "considered but robust" and it would ensure the safety of its shipping.

On Friday, Hunt said the solution would be found via diplomacy and London was "not looking at military options." Britain's government said it had advised British shipping to stay out of the Hormuz area for an interim period.

Agencies