The navy personnel were part of Britain’s contingent in a US-led naval force mustered by the Bush administration aimed against Tehran, demanding that Iran end its nuclear programme and alleged sponsorship of the insurgency in Iraq. The US, with two aircraft carrier battle groups, had built up its largest naval presence in the region since it launched the invasion of Iraq in 2003. Britain had doubled the size of its naval presence over the preceding six months.

At the time, Des Browne, the Defence Secretary, claimed, “There is no doubt that HMS Cornwall was operating in Iraqi waters and that the incident itself took place in Iraqi waters ... I do not think that even they [the Iranians] sustain the position that the incident took place anywhere other than in Iraqi waters.”

Browne’s statement was backed up by Vice Admiral Charles Style, the Deputy Chief of the Defence Staff, who told a press conference that the UK “unambiguously contest” allegations that the sailors were inside Iranian waters and produced photographs and charts that purported to back up his claim.

First Sea Lord Admiral Sir Jonathon Band denied allegations that HMS Cornwall had been involved in intelligence-gathering operations against Iran. “We are certainly not spying on them,” he said. “The Iranians in that part of Iraqi territorial waters are not part of the scene.”

What Browne, Style and Band never revealed, according to the MoD documents, was that the US-led coalition in Iraq had unilaterally decided to draw a dividing line between disputed Iraqi and Iranian waters in the Persian Gulf before the incident, without telling the Iranian government where it was.

One of the reports, “Why the incident occurred,” dated April 13, 2007, sent to Air Chief Marshal Sir Jock Stirrup, the Chief of the Defence Staff, a week after the navy personnel were released says, “Since the outset of the Iraq-Iran War there has been no formal ratified TTW [territorial waters] agreement in force between Iraq and Iran ... While it may be assumed that the Iranians must be aware of some form of operational boundary, the exact coordinates to the Op Line have not been published to Iran.”

The communications log between HMS Cornwall and its two boarding vessels also discloses that Revolutionary Guard patrols were crossing the line (unaware of the change), three times a week before the incident and that it appears the British forces raised their weapons first.

The MoD still refuses to make known the precise location of the incident, claiming it would jeopardise “operational tactics, routines and capability” of British forces operating in the Persian Gulf.

At the time there were fears that the US would utilise the incident as an excuse for launching military action against Tehran. The US navy launched a major military exercise within days of the capture of the sailors. Prime Minister Tony Blair condemned Iran’s actions as “completely unacceptable, wrong and illegal” and warned, “It is now time to ratchet up international and diplomatic pressure in order to make sure that the Iranian government understands their total isolation on this issue.”

Blair had acted as Washington’s key ally in seeking to isolate the Iranian regime and impose the strictest sanctions possible, alongside making preparations for a possible military assault.

Britain demanded a United Nations Security Council resolution against Iran that placed the blame squarely on Tehran, but even so right-wing British newspapers denounced Blair for failing to take tougher action against the Iranian regime. The Times itself condemned “the pusillanimous timidity of British officials and politicians, who have failed disgracefully to confront Iran with the ultimatum this flagrant aggression demands.”

The Daily Telegraph called for intensified sanctions against Iran unless “it stops lying to us about the details of its nuclear program, [stops] arming and directing insurgents in southern Iraq, and [stops] violating Iraqi territorial waters ... We wait anxiously to see whether this weakened and discredited Prime Minister has the necessary spine to do what is required, or whether Britain will persist in presenting its weakest aspect to a potential enemy.”

Neo-conservative circles within the US declared the detention of the British personnel to be an act of war on a NATO country and demanded other members of the alliance support the UK. Several top US military personnel made clear that had American sailors been involved in such an incident they would have fired on the Iranian forces. Lieutenant Commander Erik Horner, second in command of the USS Underwood in the Gulf declared, “We not only have the right to self-defence, but also an obligation to self-defence.”

Senator Joseph Biden of Maryland, chairman of the Senate Foreign Relations Committee, called on the Bush administration to make plans to cut off Iran’s “importation of refined oil and affect their export of crude oil. You can hit them very, very badly. But I don’t think you talk about that publicly. Were I president, I wouldn’t be talking about that. I’d be planning that while I was moving on every front diplomatically.”

However, whilst Bush called Iran’s action “inexcusable behaviour” and called on the country’s leaders to “give back the hostages,” the administration kept a relatively low profile over the incident. Within American ruling circles, there remained significant opposition to a military attack on Iran, particularly under conditions where the US was still bogged down in Iraq and Afghanistan and was politically isolated internationally.

In the event, the Persian Gulf incident resulted in a humiliation for the Blair government, epitomising the gap between Britain’s pretensions as a world power and its actual capabilities. London was only able to secure the most limited formal censure of Iran’s actions at the UN and from the European Union. Foreign Secretary Margaret Beckett was forced to tone down her rhetoric at a European Union summit saying, “I think everyone regrets that this position has arisen ... What we want is a way out of it.”

A subsequent all-party parliamentary inquiry described the incident as a “national disaster” for the UK.

The capture of the sailors was a propaganda coup for the Iranian regime, which ended with President Mahmud Ahmadinejad announcing that they would be released as a “gift” to Britain in order to mark both the Prophet Muhammad’s birthday and the Easter holiday.

The British government’s cover-up immediately began to unravel once Captain Chris Air, who headed the operation, admitted, upon his release, that his crew was on an intelligence-gathering mission—a fact deliberately suppressed during the incident in order to portraying Iran as having carried out an unprovoked act of aggression.

The fact that military action faced serious opposition among working people meant that neither Bush nor Blair was in a position to simply push for an immediate attack on Iran. Both faced popular hostility to their warmongering and a belief that they were habitual liars. Even a poll by the Daily Telegraph found that only a tiny seven percent of those surveyed had been convinced by the jingoistic media campaign demanding military action against Iran.

Even so, the incident contains warnings that another pretext may be sought for military action against Iran. The Bush administration is determined to effect “regime change” in Iran in order to gain control over the country’s vast oil resources, as they have done in Iraq. Earlier this year an incident involving US warships and small, high-speed Iranian craft as they passed through the Strait of Hormuz some three miles outside Iranian waters led to a series of high-level US warnings describing their action as a “reckless and dangerous and potentially hostile act.”

The Democrats have adopted the same belligerent tone towards Iran, with leadership challenger Hilary Clinton stating during a televised debate on April 16 that an Iranian attack on Israel “would incur massive retaliation from the United States.” Responding to questions, she added that the US should “do the same with other countries in the region” and “create an umbrella of deterrence that goes much further than just Israel.”

Her rival, Barak Obama, did little to distance himself from this warlike rhetoric, stating that an attack on Israel would be “an attack on our strongest ally in the region” and that “the United States would take appropriate action.”