Ahead of the formal easing of international sanctions on Tehran set for the beginning of 2016, tensions have mounted.
On Thursday, Iranian President Hassan Rouhani ordered his defense minister to expandIran's missile program, in response to a US threat to imposenew sanctionsover a ballistic-missile testIrancarried out in October.
"As the US government is clearly still pursuing its hostile policies and illegal meddling ... the armed forces need to quickly and significantly increase their missile capability," Rouhani wrote in a letter to Defense Minister Hossein Dehghan, published on the state news agency IRNA.
US President Barack Obama and US Secretary of State John Kerry.
Iran condemned the new sanctions on international companies and individuals over Tehran's ballistic missile program.
"As we have declared to the American government ...Iran's missile program has no connection to the (nuclear) agreement," state television quoted Foreign Ministry spokesman Hossein Jaber Ansari as saying.
The US began preparing the sanctions, which target nearly a dozen companies and individuals inIran, Hong Kong, and the United Arab Emirates for their suspected role in developingIran's missile programand for supporting human-rights abuses and international terrorism,The Wall Street Journal reported, citing US officials.
According to TheJournal, the White House was recentlywarned by Iranian officialsthat new sanctions would be considered by Supreme Leader Ayatollah Ali Khamenei as a violation of the brokered nuclear agreement.
The US, however,maintainsthatthe US Treasury Department retains the right to blacklist Iranian entities despite the July agreement, arguing that areas of missile development, terrorism, and human rights are separate from the nuclear deal.
"Iranwill resolutely respond to any interfering action by America against its defensive programs," said Jaber Ansari, rejecting the new sanctions as "arbitrary and illegal."
This dispute comesafterIranand six world powers, including the US, reached ahistoric nuclear dealin July that will remove certain US, EU, and UN sanctions on Tehran in exchange forIranaccepting curbs on its nuclear program.
An Iranian Emad rocket is launched as part of a test at an undisclosed location.
Iran's controversial ballistic missile test
According toa confidential report seen by Reuters on December 15,Iran fired amedium-range ballistic Emad rocketon October 10 that was capable of delivering a nuclear warhead.
However,Iransays the resolution only bans missiles "designed" to carry a nuclear warhead, not "capable of."
Iranhas called the Emad missile a "conventional missile."
Since the October 10 incident, Iran was criticized for conducting a live-fire training exercise near a US aircraft carrier in the Gulf.
Live-firing exercise near an American aircraft carrier
Irandenied on Thursday that its Revolutionary Guardslaunched rockets near the US aircraft carrier Harry S. Trumanin the Gulf on Saturday and condemned US plans for new sanctions over its ballistic-missile program.
"The naval forces of the Guards have not had any exercises in the Strait of Hormuz during the past week and the period claimed by the Americans for them to have launched missiles and rockets," the Revolutionary Guard website quoted Ramezan Sharif, the Guard's spokesman, as saying.
"The publication of such false news under the present circumstances is akin to psychological warfare," Sharif said.
NBC News,citing unnamed US military officials, said the Guard was conducting a live-fire exercise and the US aircraft carrier Harry S. Truman came within about 1,500 yards of a rocket as it entered the Gulf with other warships.
The aircraft carrier USS Harry S. Truman (CVN 75) transits the Straight of Hormuz.
Several Revolutionary Guard vessels fired the rockets "in close proximity" of the warships and nearby merchant traffic "after providing only 23 minutes of advance notification," said Cmdr. Kyle Raines, spokesman for the US Central Command.
Rainesdescribed the incident as"uncharacteristic of most interactions" between the US and Iranian navies, CNNreports.
"While most interactions betweenIranian forces and the US Navy are professional, safe, and routine, this event was not and runs contrary to efforts to ensure freedom of navigation and maritime safety in the global commons,"Raines said.
According to the Pentagon, the Harry S. Truman was operating in an "internationally recognized maritime traffic lane" when Iran's navy conducted their exercise.
Iranian and US forces have clashed in the Gulf in the past, especially during theIran-Iraq war in the 1980s after the 1979 Islamic revolution.
A map of the area where the incident is said to have taken place.