“This is a dangerous game,” an Iranian foreign ministry official warned on Friday. He was urging the UK to release the Iranian tanker which the British navy helped authorities in Gibraltar to seize last week. But the context, as he made clear, is the intensifying struggle between Washington and Tehran, in which the main players appear overconfident they know the rules and understand the stakes, while minor players fret about outcomes they have limited power to change.

Mohamed ElBaradei, who headed the UN nuclear watchdog in the run-up to the invasion of Iraq, has offered one of the sharpest warnings of the potential consequences: “All that I hear basically [brings] to mind the days before the Iraq war,” he told the BBC. The Iranian regime’s record at home and in the region is a grim one. But this crisis was created by the US president’s determination to destroy an international nuclear deal – which Iran was abiding by – and throttle the economy. It cornered Tehran and empowered its hardliners, who seized on the proof that America could never be trusted.

Yet while the Trump administration turns the screws, it is unclear what it wants. Donald Trump does not share John Bolton’s thirst for regime change, seeing an expensive war as unhelpful to his prospects of reelection. Last month he called off airstrikes at the eleventh hour. Even as the administration seizes on every Iranian action, it has apparently refrained, at least for now, from blacklisting the foreign minister, Javad Zarif, and cutting off the route to dialogue.

Europe has been desperately trying to shore up the joint comprehensive plan of action (JCPOA). But the awkwardness of Britain’s position became clearer when the Royal Navy reported it had seen off an Iranian attempt to intercept a Manx-flagged oil tanker in the strait of Hormuz on Wednesday. Tehran denies harassment, but the UK has put shipping on maximum alert in the Gulf and sent another warship.

The obvious trigger was the seizure of the Iranian tanker. Britain says it acted at the request of Gibraltar’s authorities and on suspicion the vessel was bound for Syria in breach of EU sanctions – not in response to the US sanctions on Iran. But there is widespread suspicion that US pressure was key. Iran’s anger is magnified by frustration that Europe has failed to mitigate the impact of US hostility.

The US is increasing its military presence in the region because of Tehran’s “hostile behaviour” and has imposed sanctions on the supreme leader Ayatollah Khamenei; a move that Iran said closed the path to the dialogue the US purports to seek. Meanwhile Iran has breached the JCPOA by increasing its uranium enrichment over the agreed threshold, albeit modestly. This, like earlier attacks on tankers attributed to Iran (despite its denials) and the shooting down of a US drone, are essentially symbolic actions. A far more significant step would be to halt International Atomic Energy Agency monitoring and supervision.

Iran believes it must up the ante if it is to gain any kind of relief from the crippling sanctions regime now imposed upon it, and though it knows the US could start a war, hopes the fear of not finishing it will continue to deter Mr Trump. The risk is that the president may be goaded into a war by those around him, particularly if things go wrong on the ground – and that Britain will be dragged in by a White House-appeasing prime minister.

Meanwhile the slow slog of diplomacy continues, with European foreign ministers due to meet again on Monday. The EU says that more members, and non-member states too, are buying into the Instex barter-style system created to enable trade. But it still needs proper funding. Ministers must also throw their full weight behind the French-led mission to calm tensions and call out US actions as unequivocally as they have Iran’s. Hopes of halting the escalation may be faint, but the alternative should be unthinkable.