US warns Iran as 'terror plot' is foiled

Two Iranian nationals have been charged with offences including conspiracy to murder a foreign official amid claims the Iranian government factions were behind the plot.

American officials said the attempt was part of a wider planned bomb attack.

Manssor Arbabsiar, who is in custody in New York, and his alleged co-conspirator Gholam Shakuri, who is said to be in Iran, are believed to have been targeting a restaurant frequented by Saudi ambassador Adel al Jubeir.

The British Prime Minister’s office said Tehran should be "held accountable" after the alleged plot was uncovered by a US agent posing as part of a Mexican drugs cartel, who was enrolled by the suspects to help.

US attorney general Eric Holder told a press conference: "The criminal complaint unsealed today exposes a deadly plot directed by factions of the Iranian government to assassinate a foreign ambassador on US soil with explosives.

"Through the diligent and co-ordinated efforts of our law enforcement and intelligence agencies, we were able to disrupt this plot before anyone was harmed."

Secretary of state Hillary Clinton said the US was preparing new penalties against Iran, including financial sanctions against individuals.

She said: "This really, in the minds of many diplomats and government officials, crosses a line that Iran needs to be held to account for."

Tehran has reportedly dismissed the assassination plot claims, with a spokesman for president Mahmoud Ahmadinejad branding them a "fabrication".

FBI director Robert Mueller said many lives could have been lost in what is alleged to be "the opening act" of an attack on US soil.

The US State Department has issued a worldwide travel alert for US citizens, warning the planned assassination "may indicate a more aggressive focus by the Iranian government on terrorist activity against diplomats from certain countries".

This could include "possible attacks in the United States," it said in a statement on its website.

Saudi Arabia's embassy in Washington described the alleged plot as a "despicable violation" of international conventions.

Sky's foreign affairs editor Tim Marshall said sanctions against Iran in response "will not placate the hawks in America".

"Down the line, this could be used to make the case for justification (for military action)," he said.