A highly placed Gibraltarian government source denied on Tuesday an Iranian news agency report which said the Iranian oil tanker Grace 1 would be leaving the British overseas territory on Tuesday.

British Royal Marines seized the tanker on July 4 off the coast of the British Mediterranean territory of Gibraltar on suspicion of violating EU sanctions by taking oil to Syria, which Tehran denies.

Iran's semi-official Fars news agency quoted unidentified Gibraltar authorities as saying the tanker would bee freed on Tuesday evening.

A senior Gibraltarian government source said that report was not correct. Earlier, Gibraltar said it was seeking to de-escalate the situation.