Summary: Israel has been highly vocal about the oil smuggling being conducted by Iran. It is in clear violation of the sanctions in effect. Iran has responded by heightening its military presence in the Gulf of Aden with naval force and promising a firm response to any perceived hostilities.
Additional Considerations: In early March, Prime Minister Benjamin Netanyahu urged world powers to foil any effort by Tehran to evade US sanctions. The Israeli leader told naval officers that Iran was still resorting to clandestine measures to ship fuel that it first used prior to a 2015 nuclear deal easing Western sanctions on its oil sector. He stated Iran is trying to circumvent the sanctions through covert oil smuggling over maritime routes and, to the extent that these attempts widen, the navy will have a more important role in blocking these Iranian actions (algemeiner.com/). According to maritime experts, Iran has used a variety of measures to evade sanctions including changing the names of ships or flag registries, switching off location transponders on ships, and conducting ship-to-ship transfers offshore and away from large trade hubs.
An Iranian Revolutionary Guards commander responded that enemies will regret any confrontation with the Islamic Republic. Major General Gholamali Rashid was quoted by Tasnim news agency as saying. "We never welcome any war, but we are ready to respond to any invasion. We hope the aggressors do not need to understand this point by trying it and paying a high price." Iran's navy has extended its reach in recent years, dispatching vessels to the Indian Ocean and the Gulf of Aden (middleeasteye.net/irans-defence-minister-warns-firm-response-if-israel-acts-against-its-oil-shipments).
While Iran hasn’t confronted any militaries, it has asserted military force. In early March, Iranian naval forces saved one of the country’s oil tankers from a pirate attack in the Bab-el-Mandeb Strait, which links the Gulf of Aden to the Red Sea. Commandos of the Navy’s 60th flotilla of warships, which patrols the Gulf of Aden waters in an overseas mission, saved the tanker carrying 150,000 tons of oil products (iranian.com/navy-foils-pirate-attack-on-iranian-oil-tanker/).
The Israeli Prime Minister has threatened possible military recourse if Iran continues to violate the sanctions, explaining that the future role of the Israeli navy will be to block such smuggling operations. However, this statement is made at a time when the Israeli navy consists primarily of missile corvettes and a small fleet of submarines and already has an extensive mission in the Mediterranean and Red Seas (reuters.com/israels-navy-could-act-against-iranian-oil-smuggling-netanyahu-idUSKCN1QN2EM). It also comes at a time when Iran is in the process of modernizing its own armed forces. The new Persian year beginning on March 21, 2019, was dubbed as Iran's year of Defense Products and Achievements Booms by the country's defense minister. They decided to showcase a part of Iranian defensive and technological advances. They intended to display much defense achievements, including all-Iranian fighters of Kowsar, Toofan armored vehicle, Fateh submarines, and Hoveizeh cruise missile that were all the result of Iranian experts (globalsecurity.org/2019/iran-190313-irna01.htm). Back in February 2018, Leader of the Islamic Revolution, Ayatollah Seyed Ali Khamenei, called for efforts to maintain and boost Iran’s defense capabilities hitting back at the enemies for disputing the country’s missile program.
On March 12, Iranian Defense Minister, Brigadier General Amir Hatami, highlighted the country’s military preparedness to counter foreign threats and said the Islamic Republic is boosting its defense power to prevent war.
“What they are telling us today is that you should not have missiles and defense power while they allow other countries to make our region filled with weapons and bombs.”
Iranian officials have repeatedly underscored that the country will not hesitate to strengthen its military capabilities, including its missile power, which are entirely meant for defense, and that Iran’s defense capabilities will never be subject to negotiations (tasnimnews.com/en/news/iran-boosting-defense-might-to-prevent-war-minister).
Conclusion: It is not plausible that the hostilities will amount to more than posturing. Both countries are playing to the international community. Israel does not have the resources to effectively carry out their threats against Iran’s oil smuggling. Its hope is that by bringing attention to the situation, it will ultimately force the hand of other countries to enforce the sanctions with their naval force.
Many things are driving Iran’s aggressive response and militaristic talk. Iranian president, Hassan Rouhani, had been a strong supporter of multilateral nuclear deals that had been made with the US. The sanctions the US has imposed on them and the tough stances taken by the Trump administration have left Rouhani politically weakened against the hardliners who had opposed his reforms (news.yahoo.com/rouhani-calls-irans-political-factions-end-infighting-unite-225506534.html). He is now trying to save face and recoup lost political capital by taking an aggressive stance against the West.
The best-case scenario is that all parties will be brought back to the negotiation table and negotiate some practical resolution. While this avenue may be pursued and be achievable down the road, it is unlikely that any such overture will be made in the immediate future. In the meantime, the expectation is that everything will amount to little more than aggressive speeches and saber rattling. The US will continue to publicly support Israel while offering at best token support to the issue while Iran will promise militaristic action in an effort to save face. It will be crucial in the next few months that no one make excessive moves that could heighten the situation.