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DUBAI (Reuters) - Iran rejected accusations by the United States that it was behind attacks on Saudi oil plants that risk disrupting world energy supplies and warned on Sunday that U.S. bases and aircraft carriers in the region were in range of its missiles.

Yemens Houthi group claimed responsibility for Saturdays attacks that knocked out more than half of Saudi oil output or more than 5% of global supply, but U.S. Secretary of State Mike Pompeo said the assault was the work of Iran, a Houthi ally.

The drone strikes on plants in the heartland of Saudi Arabias oil industry, including the worlds biggest petroleum processing facility, were expected to send oil prices up $5-10 per barrel on Monday as tensions rise in the Middle East.

Iranian foreign ministry spokesman Abbas Mousavi dismissed the U.S. allegation as pointless. A senior Revolutionary Guards commander warned that the Islamic Republic was ready for full-fledged war.

All American bases and their aircraft carriers in a distance of up to 2,000 kilometers around Iran are within the range of our missiles, the semi-official Tasnim news agency quoted commander Amirali Hajizadeh as saying.

State oil giant Saudi Aramco said the attack cut output by 5.7 million barrels per day, at a time when Aramco is trying to ready itself for what is expected to be the worlds largest share sale.

Aramco gave no timeline for output resumption. A source close to the matter told Reuters the return to full oil capacity could take weeks, not days.

Another source briefed on the developments said Saudi oil exports would continue to run as normal this week thanks to large storage in the kingdom.

But it remains unclear how long the oil production shut down will continue, because the damage to the infrastructure was big and could not be fixed overnight, the source added.

Traders and analysts said crude may spike to as high as $100 if Riyadh fails to quickly bring back supply.

The kingdom, the worlds top oil exporter, ships more than 7 million barrels of oil to global destinations every day.

Riyadh said it would compensate for the loss by drawing on its stocks which stood at 188 million barrels in June, according to official data. The United States said it was also ready to tap emergency oil reserves if needed.

The Saudi bourse closed down 1.1% with banking and petrochemical shares taking the biggest hit. Saudi petrochemical firms announced a significant reduction in feedstock supplies.

Abqaiq is the nerve center of the Saudi energy system. Even if exports resume in the next 24-48 hours, the image of invulnerability has been altered, Helima Croft, global head of commodity strategyat RBC Capital Markets, told Reuters.

According to U.S. government information, 15 structures at Abqaiq suffered damage on their west-northwest facing sides.

Pompeo said there was no evidence the attack came from Yemen, where a Saudi-led coalition has been battling the Houthis for over four years in a conflict widely seen as a proxy war between Saudi Arabia and Shiite Muslim rival Iran.

Amid all the calls for de-escalation, Iran has now launched an unprecedented attack on the worlds energy supply, he said.

Some Iraqi media outlets said the attack came from there. Baghdad denied this on Sunday and vowed to punish anyone using Iraq, where Iran-backed paramilitary groups wield increasing power, as a launchpad for attacks.

Kuwait, which borders Iraq, said it was investigating the sighting of a drone over its territory and coordinating with Saudi Arabia and other countries. The cabinet said the prime minister ordered tighter security at vital installations.

Riyadh accused Iran of being behind previous attacks on oil pumping stations and the Shaybah oilfield, charges Tehran denies. It has not yet blamed any party for Saturdays strike, but linked it to a recent series of attacks on Saudi oil assets and crude tankers in Gulf waters.

Riyadh says Iran arms the Houthis, a charge both deny.

Regional tensions have escalated since Washington quit an international nuclear deal and extended sanctions on Iran.

U.N. Secretary-General Antonio Guterres condemned Saturdays attacks and called on all parties to exercises restraint and prevent any escalation.

The European Union warned that the strikes posed a real threat to regional security, Britain called them a reckless attempt to disrupt global oil supplies and France said such actions could only worsen risk of conflict. Irans ally Turkey called for the avoidance of provocative steps.

U.S.-IRAN TALKS

The attack comes after U.S. President Donald Trump said a meeting with Iranian President Hassan Rouhani was possible at the United Nations General Assembly in New York this month. Tehran ruled out talks until sanctions are lifted.

White House adviser Kellyanne Conway did not rule out a possible meeting between the two but told Fox News Sunday that the strikes did not help that prospect.

Saudi de facto ruler Crown Prince Mohammed bin Salman told Trump that Riyadh was ready to deal with terrorist aggression.

The Saudi-led coalition has responded to past Houthi attacks with air strikes on the groups military sites in Yemen.

The conflict has been in military stalemate for years. The alliance has air supremacy but has come under scrutiny over civilian deaths and a humanitarian crisis that has left millions facing starvation. The Houthis, more adept at guerrilla warfare, have increased attacks on Saudi cities, thwarting peace efforts.

The United Arab Emirates, Riyadhs main partner in the alliance, has reduced its presence in Yemen due to concern over rising Iran tensions and Western criticism of the war, leaving Riyadh to try to neutralize the Houthi threat along its border.

Irans foreign minister Mohammed Javad Zarif said Washington and its allies were stuck in Yemen and that blaming Tehran wont end the disaster.

Additional reporting by Saeed Azhar and Hadeel Al Sayegh in Dubai, Timothy Gardner in Washington, William James in London, John Irish in Paris, Alex Lawler, Julia Payne and Ron Bousso in London, Robin Emmott in Brussels, and Michelle Nichols in New York; Writing by Ghaida Ghantous; Editing by Elaine Hardcastle, William Maclean

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Iran dismisses U.S. claim it was behind Saudi oil strikes ...

Iran, a mountainous, arid, and ethnically diverse country of southwestern Asia. Much of Iran consists of a central desert plateau, which is ringed on all sides by lofty mountain ranges that afford access to the interior through high passes. Most of the population lives on the edges of this forbidding, waterless waste. The capital is Tehrn, a sprawling, jumbled metropolis at the southern foot of the Elburz Mountains. Famed for its handsome architecture and verdant gardens, the city fell somewhat into disrepair in the decades following the Iranian Revolution of 197879, though efforts were later mounted to preserve historic buildings and expand the citys network of parks. As with Tehrn, cities such as Efahn and Shrz combine modern buildings with important landmarks from the past and serve as major centres of education, culture, and commerce.

The heart of the storied Persian empire of antiquity, Iran has long played an important role in the region as an imperial power and laterbecause of its strategic position and abundant natural resources, especially petroleumas a factor in colonial and superpower rivalries. The countrys roots as a distinctive culture and society date to the Achaemenian period, which began in 550 bce. From that time the region that is now Irantraditionally known as Persiahas been influenced by waves of indigenous and foreign conquerors and immigrants, including the Hellenistic Seleucids and native Parthians and Ssnids. Persias conquest by the Muslim Arabs in the 7th century ce was to leave the most lasting influence, however, as Iranian culture was all but completely subsumed under that of its conquerors.

An Iranian cultural renaissance in the late 8th century led to a reawakening of Persian literary culture, though the Persian language was now highly Arabized and in Arabic script, and native Persian Islamic dynasties began to appear with the rise of the hirids in the early 9th century. The region fell under the sway of successive waves of Persian, Turkish, and Mongol conquerors until the rise of the afavids, who introduced Twelver Shiism as the official creed, in the early 16th century. Over the following centuries, with the state-fostered rise of a Persian-based Shii clergy, a synthesis was formed between Persian culture and Shii Islam that marked each indelibly with the tincture of the other.

With the fall of the afavids in 1736, rule passed into the hands of several short-lived dynasties leading to the rise of the Qjr line in 1796. Qjr rule was marked by the growing influence of the European powers in Irans internal affairs, with its attendant economic and political difficulties, and by the growing power of the Shii clergy in social and political issues.

The countrys difficulties led to the ascent in 1925 of the Pahlavi line, whose ill-planned efforts to modernize Iran led to widespread dissatisfaction and the dynastys subsequent overthrow in the revolution of 1979. This revolution brought a regime to power that uniquely combined elements of a parliamentary democracy with an Islamic theocracy run by the countrys clergy. The worlds sole Shii state, Iran found itself almost immediately embroiled in a long-term war with neighbouring Iraq that left it economically and socially drained, and the Islamic republics alleged support for international terrorism left the country ostracized from the global community. Reformist elements rose within the government during the last decade of the 20th century, opposed both to the ongoing rule of the clergy and to Irans continued political and economic isolation from the international community.

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GENEVA/LONDON (Reuters) - Iran will not surrender to U.S. pressure and will not abandon its goals even if it is bombed, President Hassan Rouhani said on Thursday, stepping up the war of words between the Islamic Republic and the United States.

FILE PHOTO: Iranian Revolutionary Guards speed boats are seen near the USS John C. Stennis CVN-74 (not pictured) as it makes its way to gulf through strait of Hormuz, December 21, 2018. REUTERS/Hamad I Mohammed/File Photo

Earlier in the day, Irans top military chief said the standoff between Tehran and Washington was a clash of wills, warning that any enemy adventurism would meet a crushing response, the semi-official Fars news agency reported.

Tensions are festering between the two countries after Washington sent more military forces to the Middle East in a show of force against what U.S. officials say are Iranian threats to its troops and interests in the region.

Acting U.S. Defense Secretary Patrick Shanahan on Thursday confirmed that the Pentagon was considering sending yet further U.S. troops to the Middle East as one of the ways to bolster protection for American forces there.

After pulling out of Irans 2015 nuclear deal with world powers, U.S. President Donald Trump restored U.S. sanctions on Iran last year and tightened them this month, ordering all countries to halt imports of Iranian oil or face sanctions of their own.

More than one year after the imposition of these severe sanctions, our people have not bowed to pressures despite facing difficulties in their lives, Rouhani was quoted by the state news agency IRNA as saying.

Addressing a ceremony in commemoration of the 1980-88 Iran-Iraq war, he added: We need resistance, so our enemies know that if they bomb our land, and if our children are martyred, wounded or taken as prisoners, we will not give up on our goals for the independence of our country and our pride.

Irans armed forces chief of staff, Major General Mohammad Baqeri, also pointed to an Iranian battle victory in the war with Iraq and said that outcome could be a message that Iran will have a hard, crushing and obliterating response for any enemy adventurism.

On Sunday, Trump tweeted: If Iran wants to fight, that will be the official end of Iran. Never threaten the United States again!

Trump wants Iran to come to the table to negotiate a new deal with stricter curbs on its nuclear and missile programs.

Reiterating Irans stance, the spokesman for its Supreme National Security Council said on Thursday: There will not be any negotiations between Iran and America.

Keyvan Khosravi was also quoted as saying by the state broadcaster that some officials from several countries have visited Iran recently, mostly representing the United States.

He did not elaborate, but the foreign minister of Oman, which in the past helped pave the way for negotiations between Iran and the United States, visited Tehran on Monday.

Without exception, the message of the power and resistance of the Iranian nation was conveyed to them, he said.

In Berlin, a German diplomatic source told Reuters that Jens Ploetner, a political director in Germanys Foreign Ministry, was in Tehran on Thursday for meetings with Iranian officials to try to preserve the nuclear accord and cool tensions in the region.

Irans Foreign Minister Mohammad Javad Zarif visited neighboring Pakistan on Thursday to discuss regional issues with its top officials.

Currently our region is in a very critical situation and dangerous measures are being formed in the region, so we need consultations with all our neighbors, Zarif was quoted as saying by Fars news agency upon arrival in Islamabad.

Zarif called on the international community to take practical steps to counter U.S. aggressive and bullying approach against Tehran.

Reporting by Babak Dehghanpisheh in Geneva and Bozorgmehr Sharafedin in London; Editing by Mark Heinrich and Toby Chopra

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Iran says it will not surrender even if it is bombed - Reuters

Hanging over the current disagreement is the debate over the Iraq war and, specifically, Secretary of State Colin L. Powells address to the United Nations in 2003. Mr. Powells presentation included fuzzy images and partial communications intercepts, and detailed what came to be understood as wildly wrong assessments about the Iraqi governments illicit weapons.

In the debate over Iran, Representative Seth Moulton, Democrat of Massachusetts, has introduced legislation to require the Trump administration to get congressional approval before engaging in hostilities with Iran. In April, Senator Rand Paul, Republican of Kentucky, pressed Mr. Pompeo during a hearing for the same commitment, but the secretary of state deflected the request.

Most Republicans signaled they supported the administrations tough line. Iran seems to be more aggressive, and we have to push back, Senator Richard C. Shelby, Republican of Alabama and the chairman of the Appropriations Committee, said after meeting with intelligence officials. We cannot give them a lot of space.

Divisions over the intelligence extended to American allies.

Troops from Germany and the Netherlands were pulled back to bases in Iraq. Spanish defense officials, to avoid entanglement in any upcoming conflict with Iran, withdrew a frigate that was part of the American-led carrier strike group heading to the Persian Gulf. Training efforts by France and the North Atlantic Treaty Organization are continuing as normal.

The State Department ordered nonemergency U.S. government employees at both the embassy in Baghdad and the consulate in Erbil, the Kurdish capital, to leave the country. The order applied primarily to full-time diplomats posted to Iraq; an embassy statement said that visa services in Iraq would be suspended as a result. Contractors who provide security, food and other such services will remain in place for now.

Mr. Pompeo shared some details of the intelligence with Iraqi leaders on May 7 when he made a surprise visit to Baghdad. But American officials in Washington said the most delicate intelligence was not shared with the Iraqis for fear their agencies have been penetrated by Iranian spies.

Tensions with Iran have been rising since May 2018, when Mr. Trump withdrew the United States from the 2015 nuclear deal that world powers reached with Tehran. American sanctions were reimposed in November, weakening the Iranian economy perhaps more quickly than expected.

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"Don't test us," Hamid Baeidinejad, Iran's ambassador to the United Kingdom said in an interview with Sky News Tuesday.

"While we have renounced any escalation in the region, I would assure you that Iranian armed forces are fully ready for any eventuality in the region, so they should not try to test the determination of Iran to confront any escalation in the region," Baeidinejad said.

His comments come shortly after the head of Iran's National Security Foreign Policy Committee, Heshmatollah Falahat Pisheh, said the international community must be wary of "making crises" surrounding the "sabotage" of four commercial ships off the coast of the United Arab Emirates over the weekend, as tensions continue to rise between Iran and the United States.

When asked about the attack on Monday, President Donald Trump fired a verbal warning to Iran, telling reporters, "We'll see what happens with Iran. If they do anything, it would be a bad mistake."

Pisheh said in an interview with Iranian state media Monday that "Iran and the United States can manage the crisis by themselves."

"But there are third parties who might make the atmosphere of the region more sensitive in terms of security by making deviant moves," he said. "There are different groups whose goal is to make the region unsafe. Therefore, there must be red lines between Iran and the United States in the management of the events which prevents third parties from making crises."

The Islamic Republic of Iran condemns these moves, Piseh said, and has demanded the perpetrators be identified.

Saudi Arabia's minister of energy said Monday that two of the ships damaged were Saudi oil tankers, one of which "was on its way to be loaded with Saudi crude oil from the [Saudi] port of Ras Tanura, to be delivered to Saudi Aramco's customers in the United States." It said there were no casualties and no spillage.

Saudi Arabia's state news agency Saudi Press Agency said Monday the country "condemned the acts of sabotage."

A Norwegian shipping company confirmed to ABC News that one of the ships it manages, an oil tanker called the MT Andrea Victory, was among the four damaged ships.

The initial assessment by a U.S. military team sent to assist the UAE is that Iran or Iranian-backed proxies placed explosive charges on the four ships anchored off the coast of the United Arab Emirates, a U.S. official told ABC News. The official said each ship sustained a 5- to 10-foot hole at or below the water line.

"We need to do a thorough investigation to understand what happened, why it happened, and then come up with reasonable responses short of war," U.S. Ambassador to Saudi Arabia John Abizaid said in Riyadh on Tuesday, according to Reuters. "It's not in [Iran's] interest, it's not in our interest, it's not in Saudi Arabia's interest to have a conflict."

The increase in tensions between the U.S. and Iran could be seen in recent statements from European leaders over the past week. U.K. Foreign Secretary Jeremy Hunt told reporters in Brussels before talks with Pompeo on Monday that "we are very worried about a conflict, about the risk of a conflict ... of an escalation that is unintended," according to Reuters.

The Iranian reaction comes as The New York Times reported overnight that Acting Defense Secretary Patrick Shanahan had presented Trump with a military plan that could see 120,000 troops deployed in the Middle East if Iran were to attack American forces.

However, Dr. Sanam Vakil, senior research fellow at the Middle East & North Africa Programme of Chatham House, told ABC News such moves by the Trump administration should be taken as "bluster."

"Of course we can see the parallels with the run up to the Iraq war, but this is a president who lives up to his campaign promises," she said. "He campaigned on leaving America's military footprint from the Middle East, not increasing it."

The Trump administration's ultimate objective, she said, is to facilitate negotiations with Iran and negotiate a better deal after the U.S. pulled out of the JCPOA -- the Iran nuclear deal -- last year.

Meanwhile, "Iran are trying to send strong, but also conflicting messages about what their objectives are," Vakil said, but she said talk of parallels with the situation leading up to the 2003 Iraq War are overplayed.

"I think the context is different," she said. "Not only does the entire international community have a hangover [from] 2003, [but] the level of awareness of sleepwalking into another conflict that could potentially be much more dangerous and have wider regional implications, particularly those for European security, is making everybody very cautious."

The possibility of an Iranian-U.S. war is worrying for many people in the country's capital of Tehran.

Mehdi Mohammadi, 32, a part-time English teacher and PhD student of philosophy in Tehran, told ABC News he would not be happy with war, "unlike those who might think Trump will come and topple the system and bring the country a democratic system and freedom of speech."

"Trump does not care about democracy here," he said. "I hope Iran stops saying it does not negotiate. We are not the only ones Trump tore agreements with. China kept negotiating, so did Canada. Even negotiation with Trump is better than a war."

Maryam Agharabi, 35, local Tehran business owner from the northern city of Rasht, said the recent tensions are unsurprising, but the primary concern for most Iranians is "changing our life style to adapt to the deteriorating economic conditions."

"I do believe the sanctions on Iran should be called an 'economic terror' rather than an economic war," she said. "War is reciprocal, like what is going on between China and America, where the two parties have means to use against each other. What America is doing against us is totally unilateral."

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