Iran expects to equip Gulf ships with missiles soon

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* Iran warning West not to attack it over its nuclear work

DUBAI, June 29 (Reuters) - Iran expects to equip its ships in the Strait of Hormuz soon with shorter-range missiles, a Revolutionary Guards commander was quoted as saying, in the latest apparent warning to the West not to attack it over its disputed nuclear programme.

The Islamic Republic has threatened to shut the Strait, the conduit out of the Gulf for 40 percent of the world's seaborne oil trade, if Western sanctions aimed at curbing its nuclear works block its own crude exports.

The European Union plans to impose a total embargo on Iranian oil from Sunday and has told Tehran that more punitive steps could follow if it keeps defying U.N. demands for limits nuclear activity that could be of use in developing bombs.

"We have already equipped our vessels with missiles with a range of 220 km (136 miles) and we hope to introduce missiles with a range of over 300 km (186 miles) soon," Ali Fadavi said, the semi-official Mehr news agency reported on Friday.

"We could target from our shores all areas in the Persian Gulf region, the Strait of Hormuz and the Sea of Oman."

Iran is about 225 km (140 miles) at its nearest point from Bahrain, where the U.S. Fifth Fleet is based, and about 1,000 km (625 miles) from its arch-enemy Israel. Tehran's longest-range missile, the Sajjil-2, can fly up to 2,400 km (1,500 miles).

Iran's military and security establishment often asserts its strength in the region, particularly in the Strait of Hormuz, the world's most important oil transit channel carrying supplies from Gulf producers to the West.

But it has increasingly flexed its military muscle in the face of U.S. and Israeli warnings that last-resort military action against Iran cannot be ruled out if diplomacy and sanctions fail to resolve the nuclear dispute.

In January, the Islamic Republic said it had successfully test-fired what it called two long-range missiles.

Earlier this month, the Iranian navy announced plans to build more warships and increase its presence in international waters such as the Gulf of Aden and northern Indian Ocean.

Iran denies Western suspicions that it is trying to develop technology and material required to produce nuclear weapons, saying it needs the know-how solely to generate electricity.

Tehran has said it would retaliate for any attack with missile strikes against Israel and U.S. assets in the Gulf.

A third round of nuclear talks between world powers and Iran on June 18-19 aimed ultimately at curbing Iranian nuclear activity in exchange for sanctions relief failed to ease the stalemate. With that process seemingly close to collapse, Israel renewed veiled threats to hit Iranian nuclear installations that it considers a mortal threat. (Writing by Zahra Hosseinian; Editing by Mark Heinrich)

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