Iran's foreign minister said on Saturday he believed neither the United States nor Israel would want to get entangled in a new Middle East crisis and attack the Islamic Republic over its nuclear ambitions.

The comments by Manouchehr Mottaki came a few days after Iranian missile tests heightened regional tension and helped send world oil prices to new record levels.

"The Zionist regime is still involved in the after-shocks of the war with Lebanon." Mottaki told the official IRNA news agency, referring to Israel's inconclusive 2006 Second Lebanon War with Hezbollah guerrillas.

"And the U.S. still does not possess the capacity to enter another crisis in the Persian Gulf region."

Mottaki also said that Iran's response would be "firm and pounding" if its two foes launched strikes against the country.

But, he added: "Of course, the Zionist regime and the U.S. do not possess such capacities to want to involve themselves in new crises."

Iran says its nuclear program is aimed only at generating electricity. Western nations and Israel fear the world's fourth-largest oil exporter is seeking to build nuclear weapons.

Washington has said it wants diplomacy to end the nuclear row but has not ruled out military action should that fail.

Israel has sworn to prevent Iran from emerging as a nuclear-armed power.

Last month it reportedly staged an air force exercise that stoked speculation about a possible assault on Iranian nuclear sites.

Also Saturday, Iran warned the United States and Israel on Saturday it would be "madness" to attack the Islamic Republic over a nuclear programme the West suspects is aimed at making bombs.

"We do not imagine that anybody would commit such madness and stupidity ... and nobody has the power to make such aggression," the state broadcaster quoted government spokesman Gholamhossein Elham as saying.

"The Islamic Republic of Iran is not a threat at all and will not accept any threats," he said.

Iran has vowed to strike back at Tel Aviv and U.S. interests and shipping if it is attacked. Tehran says missiles fired during Revolutionary Guards wargames on Wednesday included ones that could hit Israel and U.S. bases in the Middle East.

"The recent maneuver ... and the firing of indigenously produced missiles was the display of the Islamic Republic of Iran's capabilities and the scientists and innovators of our country," Mottaki said.

Asked how concerned President George W. Bush's administration was about the Iranian test-firings, White House spokeswoman Dana Perino told reporters in Washington on Friday: "I would just characterize it as continued Iranian defiance of international obligations and further isolating its people."

Perino said it would "re-strengthen" the international community's resolve in the standoff with Iran, but she also stressed Washington's aim of reaching a diplomatic solution.

Analysts say any U.S. or Israeli attack on Iran would be limited to air strikes, rather than a full-scale attack with U.S. ground forces, which are tied down in Iraq and Afghanistan.

They say Iran could respond with unconventional tactics, such as deploying small craft to attack ships, or using allies in the area to strike at U.S. or Israeli interests.

Senior Iranian Ayatollah: Our missiles neither threat nor fake

A senior Iranian Ayatollah said Friday that the missile tests in Iran have neither been a threat to any country nor are they fake.

"There have been several comments about our missiles' tests, especially by the United States, and all of them are wrong," said Ayatollah Mohammad Emami-Kashani at the Friday prayer ceremony in Tehran.

Iran's paramilitary Revolutionary Guards test-fired during the last three days several medium- and long-range missiles, including the Shahab-3 missile which is said to have a range of 2000 kilometres and therefore capable of reaching any part of the territory of Israel.

There have been reports that the tests were a threat against Israel and U.S. warships in the Persian Gulf and also other reports that the revolutionary guards had exaggerated Iran's missile capabilities.

"Unlike you (the U.S. and Israel), we are having our military maneuvers inside our own territory, and this is an internationally acknowledged and legitimate move," said the Ayatollah who is close to Iran's Supreme Leader Ayatollah Ali Khamenei.

"Furthermore, the Islamic Republic has in the last three decades not violated any country but in return was violated with U.S. support," he added.

Emami-Kashani was referring to the 1980-1988 Iran-Iraq war where the US supported the regime of former Iraqi President Saddam Hussein and the 1998 conflict with the ruling Taliban in Afghanistan which almost led to another regional war.

"We have a clear (territorial) framework but where is your framework? We have no history in invading other countries but what is your (U.S. and Israel) history? Invasions in Iraq, Afghanistan, Lebanon and Palestine," the Ayatollah said.

"Whether these missiles have a range of 2,000 or 3,000 or 5,000 kilometres, we do not intend to violate any country," he added, referring to reports about having manipulated the pictures of the missile launching.

"We are just saying, if you hit us, we are capable to hit back and that is quite legitimate," the leaders' aide warned.

The Ayatollah also said that the U.S. uproar over the missile tests was only to please Israel although the whole world is aware that Iran is simply following Islam and the Koran and therefore is obliged not to harm anybody, whether they are Muslims or non-Muslims.