World oil prices could soar to $200 per barrel if Iran's petroleum sector is hit with new Western sanctions, Iranian Oil Minister Rostam Qasemi said.
"There is no doubt that the price of oil will increase drastically and the international markets will have to pay a heavy price," Qasemi was quoted as saying by news weekly Aseman.
"One can't give accurate predictions, but sanctions on Iran's oil will drive up the price of oil to at least $200" per barrel, he said.
Qasemi comments comes as the European Union was considering a possible EU embargo on Iranian oil imports. EU foreign ministers are to meet on the issue in a month's time.
US President Barack Obama is also expected to soon sign into law additional restrictions on Iran's central bank, which acts as the main conduit for Iranian oil sales.
The United States and its allies have already imposed unilateral sanctions on Iran's economy.
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World oil prices slipped slightly in end-of-year trading, but still remained generally high because of the heightened tensions between the United States and Iran.
Brent North Sea crude was at $107.02 per barrel in London, while New York's main contract, light sweet West Texas Intermediate crude, was at $98.99 a barrel.
Iran today kept concern alive over its threat to close the Strait of Hormuz to oil tankers by readying war game missile tests near the entrance to the Gulf.
About 20% of the world's oil moves through the Strait of Hormuz, at the entrance of the Gulf, making it the "most important chokepoint" globally, according to information released yesterday by the US Energy Information Administration.
Iran is subject to four rounds of UN sanctions over its nuclear programme, which many Western countries allege is being used to develop atomic weapons. Tehran denies the allegation.