"It was detained near Iran's Greater Tunb island in the Persian Gulf...the crew have been handed over to legal authorities in southern Hormozgan province," ISNA said.

The Tunb Islands in the Gulf are disputed between Iran and the UAE. The seizure of the vessel coincided with heightened international tensions and a threat to global oil supplies caused by a drone attack on two major oil installations in Saudi Arabia on Saturday.

The Iranian-aligned Houthi movement in Yemen claimed responsibility for the attacks but US Secretary of State Mike Pompeo accused Iran of being behind them, saying there was no evidence that the drones were launched from Yemen.

Iran has rejected the US accusations as “meaningless” and warned that it was prepared for war.

Iran has also been engaged in a fight against fuel smuggling by land and sea to neighbouring countries in the Gulf and Asia. It heavily subsidizes fuel and this, in addition to its falling currency, means that it has some of the world’s cheapest fuel prices.

Its coast guard recently seized a ship for fuel smuggling, detaining 12 Filipino crew members.

In July, Iran also seized the British tanker Steno Impero in the Strait of Hormuz, two weeks after Britain seized the Iranian tanker Adrian Darya 1 off Gibraltar for smuggling fuel to Syria in violation of US and EU sanctions.

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