Monday, Iran's state-controlled media announced the test firing of a weapon that it claims is capable of sinking ships nearly 200 miles away. It was followed by a warning from the commander of the Islamic Revolutionary Guards Corps (IRGC) that the forces could respond to any attack by closing the Strait of Hormuz, an oil transit point.

If implemented, oil prices would likely skyrocket, as a huge amount of the world's oil passes through the Strait of Hormuz, a narrow passage along Iran's southern coast.

IRGC chief Brigadier General Mohammad Ali claimed that the new weapon runs on an indigenously developed that no other nation has experimented with before. He did not disclose the date and venue of the testing.

"None of the enemy's vessels or warships operating in a radius of more than 300 kilometers from Iran's borders will be safe from this weapon, and without a doubt, they will be sunk deep into the region's waters," Ja'fari was quoted as saying.

Iranian leaders' frequent threats of attacks and claims of developing long-range weapons are viewed as the oil-producing nation's tactic to create geo-political tension, which in turn will help in speeding up the upward trend of oil prices.

A similar threat by Ja'fari on June 28 ignited a steep rise in the price of crude to a record high.

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