UPDATE-Iran Says May Not Release British Woman

Iran will delay the release of the only woman among 15 British military personnel detained last week.

Iran will delay the release of the only woman among 15 British military personnel detained last week if Tehran is faced with "fuss and wrong behaviour" from Britain, a senior Iranian official said on Thursday.

Iranian Foreign Minister Manouchehr Mottaki said on Wednesday Iran would release Faye Turney "as soon as possible" but did not say when. A British diplomat in Tehran said the embassy had not had any official word.

"We even said that the grounds were ready for the release of a woman among the British sailors but if we are faced with a fuss and wrong behaviour then this would be suspended and it would not take place," Ali Larijani, the secretary of Iran's Supreme National Security Council, said on state television.

The detention of the British sailors, coupled with U.S. war games this week near the Iranian coast, pushed oil prices to six month highs on concerns that any escalation could hit crucial supplies from the Gulf.

"It surprises us that the British government, instead of investigating the issue from a technical and legal point of view, has turned the incident into a media work ... ," Larijani said.

Britain has said the Britons were picked up in Iraqi waters and says it has proof from a global positioning system readout. Larijani said Iran's GPS readout showed the boats involved were in Iranian waters.

"They (the British) are now in the region in which, with the excuse of controlling ships that go to Iraq, they want to make it a norm to violate other countries' sovereignty. But they should know that the cost of this (action) is not cheap," he said.

Larijani said Iran wanted the issue solved through diplomacy and bilateral talks but he said Britain's response could jeopardise that path.