Iran must bear the consequences of any new confrontation between US and Iranian vessels in the Strait of Hormuz, a senior US official warned.

Washington says Iranian boats aggressively approached three US Naval ships in the waterway, a major oil shipping route off Iran's coast, and threatened that the ships would explode.

"This was a very provocative act by the Iranians and could have and came very close to resulting in an altercation between our forces and their forces," Stephen Hadley, President George W Bush's national security adviser.

 Hadley, travelling with Bush on his first official visit to Israel, said the incident nearly led to an exchange of fire.

The United States released a video of the weekend incident, including a recording of what it said was the exchange between the two sides.

Iran rejected the footage as fake and accused Washington of trying to stir up tension in the region.

"America aims to implement this plan saying Iran has been and is the source of fear in the Middle East," Defence Minister Mostafa Mohammad Najjar was quoted by state television as saying.

"Iranian craft always ask other ships to identify themselves and this is what they did to the American ships. American ships answered and that was it."    

Bush called the incident provocative before leaving Washington on a Middle East trip aimed at nurturing Israeli-Palestinian peace efforts and rallying Arab opposition to Iran and its growing regional influence.

The encounter was the latest sign of tension between Washington and Tehran, at odds over Iran's nuclear programme and who is to blame for the violence in Iraq.

"They've got to be very careful about this because if it happens again they are going to bear the consequences," Hadley said.

"...It's the kind of incident that can provoke exchange of fire and we think the Iranians need to be on notice that they are fishing in troubled waters here," he said.

The Strait of Hormuz handles 17 million barrels per day of water-borne crude oil, over a third of total global shipments.

The US video showed several images, including about three small launches moving near a US ship. An audio recording included a voice from a US ship telling one craft it was "straying into danger and may be subject to defensive measures".

The small craft responded: "You will explode after a few minutes."   

Iran's Revolutionary Guards rejected the video released by the US Department of Defense as a fake, Iranian television reported, saying the images were archive pictures.

"A senior official with the Islamic Revolution Guards Corps said ... the video and audio the US Navy has released have nothing to do with an alleged confrontation between Iranian speedboats and three US warships in the Persian Gulf," Press TV reported on its Web site.

Israel's President Shimon Peres, welcoming Bush on his first presidential visit, immediately told him about Israel's concerns about arch-foe Iran's nuclear programme.

Iran says its nuclear work is a peaceful project to produce electricity, but the West fears it could be a cover for efforts to build a nuclear bomb.

"Iran should not underestimate our resolve for self-defence," said Peres, whose country is widely believed to have the region's only nuclear arsenal. - Reuters