The commerical tanker said to have been protected by the Royal Navy on Wednesday was operated by British Petroleum.
Hours after Iran warned Britain there would be consequences for seizing one of its oil tankers on route to Syria, five Iranian military gunboats unsuccessfully attempted to detain a British oil tanker in the Persian Gulf, U.S. defense officials said.
The ship was being escorted from the rear by a U.K. Navy frigate, the HMS Montrose, which trained deck guns on the Iranian vessels and warned them to back away - which they did -according to CNN.
"We are concerned by this action and continue to urge the Iranian authorities to de-escalate the situation in the region", said a spokesperson for Downing Street.
One-fifth of the world's oil and 90 percent of Persian Gulf oil is transported through the strait.
This May and June, six oil tankers were attacked near Iran's southern coast, in incidents the USA blamed on Iran.
Iran condemned the detention as an "illegal interception", but Gibraltar officials said that the cargo was believed to be destined for Syria, which is subject to European sanctions.
The US Energy Information Administration, meanwhile, said on Wednesday that stockpiles of American crude oil fell to their lowest level in three months.
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Iran's President Hassan Rouhani said in a cabinet session earlier on Wednesday that Britain would "see the consequences" after the Gibraltar seizure.
European parties to the agreement issued a tough joint statement on Tuesday saying Iran must reverse its activities and return to full compliance "without delay".
The BBC has been told British Heritage was near the island of Abu Musa when it was approached by the Iranian boats.
Last month Donald Trump called of military strikes against the Islamic Republic after it shot down a U.S. surveillance drone over the Strait of Hormuz.
The arrest comes after the Iranian Foreign Minister demanded Britain to release the oil tanker.
The Royal Navy has a frigate, four minehunters and a Royal Fleet Auxiliary support ship already stationed in a permanent Naval Support Facility in the region, at Mina Salman in Bahrain.
"Apparently the British tanker has passed".
The incident adds to the escalating tensions between Iran and allied nations operating in the Persian Gulf.