A picture of Ayatollah Ali Khamenei is erected between Sajjil, right, and Ghadr-F missiles in southern Tehran [AFP]

Iran plans to test-fire long range missiles during a naval exercise in the Gulf, following a threat by Tehran to close shipping lanes if the West imposes sanctions on its oil exports.

Mahmoud Mousavi, Iran's senior navy commander, told English-language Press TV, "All kinds of surface-to-sea, sea-to-sea and surface-to-air, as well as shoulder-launched missiles, will be tested in the coming days".

The semi-official Fars news agency, Press TV and the state-run IRNA news agency reported earlier on Saturday that Iran had already test-fired long-range and other missiles.

The 10-day naval drill, which began last Saturday, coincided with increased tension in Iran's nuclear row with Western
powers, after the EU said it was considering a ban - already in place in the US - on importing oil from Iran.

Tehran says the drill is aimed at showing Iran's resolve to counter any attack by enemies such as Israel or the US, which have not ruled out a military option if diplomacy fails to resolve the nuclear dispute with Iran.

Stopping the oil flow

Tehran threatened on Tuesday to stop the flow of oil through the Strait of Hormuz in the Gulf if it became the target of an oil embargo over its nuclear ambitions, a move that could trigger military conflict with countries dependent on Gulf oil.

Iran's oil minister said crude prices will rise to more than $200 per barrel if foreign sanctions are imposed on the country's oil exports over its disputed nuclear work, the Aseman weekly reported on Saturday.

"Undoubtedly the price of crude will increase dramatically if sanctions are imposed on our oil ... It will reach at least over $200 per barrel," Rostam Qasemi said.

Iranian media have said the naval exercise differed from previous ones in terms of "the vastness of the area of action and the military equipment and tactics that are being employed".

During military drills in 2009, Iran test-fired its surface-to-surface Shahab-3 missile, said to be capable of reaching Israel and US bases in the Middle East.

Washington has expressed concern about Tehran's missile programme: including the Shahab-3, a strategic intermediate range ballistic missile with a range of up to 1,000km; the Ghadr-1 with an estimated 1,600km range; and a Shahab-3 variant known as Sajjil-2 with a range of up to 2,400km.

EU 'open' to talks

Separately on Saturday, Ambassador Ali Reza Sheikh Attar announced that Iran's top nuclear negotiator, Saeed Jalili, is to send a letter soon to EU foreign policy chief Catherine Ashton to arrange a new round of negotiations over the country's disputed nuclear programme.

Attar did not say when the letter would be sent. His comments were reported by the semi-official Mehr news agency on Saturday.

The EU responded, saying it is open to meaningful talks with Tehran provided there are no preconditions on the Iranian side, an EU foreign policy spokesman said on Saturday. 

EU foreign policy spokesman, Michael Mann, said in an email to the Reuters news agency that Catherine Ashton wrote to Jalili in October and had not yet had a response.

"We continue to pursue our twin-track approach and are open for meaningful discussions on confidence-building measures, without preconditions from the Iranian side," he said. 

Rising tensions

Mahjoob Zweiri, a professor at Qatar University, told Al Jazeera that the EU would take at least 10 days to respond to Iran's overtures.

He also said that "while keeping the diplomatic track open", Iran has historically "tried to show Western powers the preparations for any type of attack".

The last round of negotiations between Iran and the six powers - the US, Russia, China, Britain, France and Germany - in January in Istanbul, Turkey, ended in failure.

Tensions with the West have risen since the UN nuclear watchdog reported on November 8 that Iran appeared to have worked on designing an atomic bomb and may still be pursuing research to that end.

Iran denies this and says it needs nuclear technology to generate electricity to meet growing domestic demand.