Prime Minister Tony Blair implied that the hostage situation involving 15 British sailors would move into a 'different phase' if they were not released by Iran. The situation, compounded by the U.N. sanctions, has raised tensions between Iran and the Wes
Tehran says that it may charge the two British ships with illegally entering it's waters, while Britain maintains that they did not leave Iraqi waters and enter into Iranian territory. The Iraqi government and local fisherman who witnessed the capture support the British statements regarding their true location.
Tony Blaire's spokesman indicated that the next step would be to produce GPS coordinates of the ships as proof of their location, but he also said "We so far haven't made explicit why we know that because we don't want to escalate this"
Other observers from Russia and Turkey said that Iran should show a positive reaction to the British demands for the safe and timely return of the prisoners. Turkish foreign minister Abdullah Gul said that he believes such a gesture would "continue to leave the door open for a constructive outcome."
There was a similar incident in 2004, when eight British servicement were captured by Iran and then released three days later. However, analysts who have compared the two incidents, say that the current crisis is more complex and will likely take longer to resolve.
Alex Bigham of the Foreign Policy Center further addressed this point, saying that "There are probably also internal political battles in Iran over what to do next."
Some hardline groups imply that Tehran could use the soldiers as a bargaining chip, in the ongoing tension over Iran's nuclear program, but other voices are calling for moderate action that will not escalate the tension.
Tehran is calling the U.N. resolution for sanctions against it's nation illegal and continues to deny having any intentions of developing nuclear weapons, despite urging by Russia and the United Arab Emirates to halt it's sensitive nuclear program.
Update - Both Britain and Iran are trying to prove whether the Marines were in Iraqi or Iranian waters, using GPS.
British point of view
Iranian point of view
Iran has also released a video of the marines, described in a
related article.