Nike Ching at the State Department and Carla Babb at the Pentagon contributed to this report.
Top officials from U.S. President Donald Trump's administration are briefing members of Congress on Tuesday about the threat they contend that Iran poses, even as Trump and a key Iranian official traded taunts.
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Secretary of State Mike Pompeo, acting Defense chief Patrick Shanahan, Joint Chiefs of Staff Chairman Gen. Joseph Dunford and an unnamed intelligence community official are planning to talk with lawmakers after days of suspicions expressed by U.S. officials that Iran was responsible for attacks last week on two Saudi oil-pumping stations and an earlier sabotage of four oil tankers.
One key lawmaker, Sen. Lindsey Graham, said Monday that after he was briefed by national security adviser John Bolton, "It is clear that over the last several weeks Iran has attacked pipelines and ships of other nations and created threat streams against American interests in Iraq.'
Graham wrote on Twitter, "The fault lies with the Iranians, not the United States or any other nation. If the Iranian threats against American personnel and interests are activated we must deliver an overwhelming military response. Stand firm Mr. President."
On Sunday, Trump tweeted, 'If Iran wants to fight, that will be the official end of Iran. Never threaten the United States again!'
In a rejoinder, Iranian Foreign Minister Mohammad Javad Zarif suggested that Trump 'try respect' instead of issuing threats.
Zarif said Trump, under pressure from a group that includes Bolton and Israeli Prime Minister Benjamin Netanyahu is hoping to achieve what 'other aggressors failed to do.''
'Iranians have stood tall for millennia while aggressors all gone,' Zarif wrote. 'Economic terrorism and genocidal taunts won't 'end Iran.''
Last week, Trump had appeared to be backing away from his apparently hawkish stance against Iran, saying he would be open to talks.
When asked by a reporter at the White House on Thursday if the United States was going to war with Iran, Trump replied, 'I hope not.'
But there has been no apparent let-up in the tensions between the United States, its regional allies and Iran.
The State Department says a 'low-grade rocket' fell inside the green zone in Baghdad, less than a kilometer from the U.S. embassy Sunday. No injuries or damage were reported.
U.S. Central Command spokesman Capt. Bill Urban said the Pentagon was aware of an explosion outside the embassy, adding, 'There were no U.S. or coalition casualties, and Iraqi Security Forces are investigating the incident.'
'Will not tolerate such attacks'
A State Department spokesman says the U.S. will not tolerate such attacks and that it will hold Iran responsible 'if any such attacks are conducted by its proxy militia forces.'
Saudi Arabia is blaming Iranian-backed Houthi rebels in Yemen for a drone attack on two Saudi oil-pumping stations last week. The Saudis also say they will not tolerate Iranian aggression.
Saudi King Salman has called for emergency summits with Persian Gulf and Arab leaders on May 30 to discuss what the kingdom's official news agency describes as 'aggressions and their consequences.'
An Iranian news agency quotes Iran's Revolutionary Guard head Hossein Salami as saying the country does not want war, but is 'not afraid' of it.
A statement from the U.S. Navy's Fifth Fleet Sunday spoke of increased maritime patrols and exercises in the Arabian Sea that highlight the 'lethality and agility to respond to threat.'
The Pentagon has already sent bombers to the region.
The increased tensions with Iran began brewing a year ago when Trump pulled the United States out of the six-nation 2015 nuclear deal with Iran.
Under the agreement, Iran limited its uranium enrichment program in exchange for the end of sanctions and economic relief.
The limitations were meant to ensure Iran does not develop nuclear weapons, something Iran denied it had been doing.
Trump, in an interview with Fox News recorded last week and broadcast Sunday, said he does not 'want to fight' but that when it comes to Iran, 'you can't let them have nuclear weapons.'
The reimposed U.S. sanctions have left the Iranian economy in tatters and Iran complains it has yet to see the promised economic benefit from the countries that are still part of the nuclear deal - Britain, China, France, Germany, and Russia.
Iranian President Hassan Rouhani announced two weeks ago he was pulling out of part of the nuclear deal and would restart some uranium enrichment if there were no economic benefits by early July.