Iranian Navy conducts war-games in the Strait of Hormuz: Military tensions combined with the threat to shut the strategically important passage could drive oil prices up further.

Mohsen Shandiz/Corbis

he U.S. has significantly increased its presence in the Persian Gulf, in response to Iran's threats to disrupt ship traffic in the Strait of Hormuz. The reportedly long-planned naval and air reinforcements are arriving as the U.S. and its allies are starting to enforce a tougher oil embargo designed to prod Iran into serious negotiations over its nuclear program. The ramp-up in America's military presence carries significant risks, particularly if Iran's Islamic Revolutionary Guards respond by mining the strait or attacking oil tankers or U.S. Navy vessels. "The message to Iran is, 'Don't even think about it,'" a senior Defense Department official tells The New York Times. Other U.S. officials say the U.S. is also wary of putting so many forces in the Gulf that Israel sees it as a green light to attack Iran's nuclear facilities. "There are a lot of expectations to manage," says Sen. John Kerry (D-Mass.).