LONDON (Reuters) - The storming of British Embassy compounds by Iranian protesters complicates the search for a negotiated solution to the standoff over Tehran's nuclear program, and appears to reflect infighting among Iranian factions.
The incident, a day after Iran's Guardian Council approved a bill downgrading diplomatic relations with London in response to new British sanctions, was a sign of rivalry among political factions in Tehran in the face of intensifying Western pressure, said some analysts.
Britain has been at the forefront of the international campaign for tougher sanctions against Iran over its nuclear program, which Britain and other Western countries suspect is aimed at developing a nuclear weapon but Tehran insists is peaceful.
"The incident raises the stakes to the point of very ill-disguised confrontation between Iran and one of the major players in the West," said Mark Fitzpatrick, Iran expert at the International Institute for Strategic Studies (IISS) think-tank.
It was a "further straw on the camel's back," coming on top of U.S. allegations of an Iran-linked plot to kill the Saudi ambassador and a U.N. report this month saying that Iran appeared to have worked on designing an atom bomb, he said.
The release of the U.N. report renewed speculation that Israel or the United States could carry out military strikes against Iranian nuclear facilities.
Britain, one of six powers which have for years been playing a complex game of cat-and-mouse with Iran over its nuclear program, said it was outraged by the incident and warned of "serious consequences" which Foreign Secretary William Hague is likely to spell out in a statement to parliament on Wednesday.
Iranian officials disowned the attacks but some commentators were skeptical of their assurances.
"The fact that demonstrators managed to get into the British embassy and cause such destruction will inevitably raise questions of government complicity in the raid," said Alan Fraser of the UK-based AKE security consultancy.
"The government also wants to demonstrate its resolve in the face of Western action against it, so this portrayal of unity benefits the regime's cause."
Days before Tuesday's attack, an Iranian lawmaker warned that Iranians could storm the British embassy as they did the U.S. mission in 1979.
Some analysts see the Tuesday attacks as a sign of deepening political infighting within Iran's ruling elites, with the conservative-led parliament attempting to force the hand of President Mahmoud Ahmadinejad and expel the British ambassador.
"Radicals in Iran and in the West are always in favour of crisis ... Such radical hardliners in Iran will use the crisis to unite people and also to blame the crisis for the fading economy," said political analyst Hasan Sedghi.
Fitzpatrick said: "One also has to keep in mind there are various players in Iran, and not all of them will have thought it was wise to facilitate a break-in of the British embassy."
Anthony Skinner of Maplecroft consultancy said it was "likely that those attacking the embassy are hardcore regime supporters."
Hague has already promised a "robust" response if Iran expels the British ambassador, as called for by the bill approved on Monday.
Analysts said the British response could range from lodging a protest over a violation of international law to cutting off diplomatic relations.
But if it did downgrade or cut off diplomatic ties, it would have to gauge what damage that would do to the negotiated solution it says it wants to the nuclear dispute.
Fitzpatrick said prospects for resuming talks between Iran and the six powers were already marginal and "this certainly doesn't help."
The last round of talks between Iran and the six, the United States, Britain, France, Germany, China and Russia, took place in January in Istanbul and ended with no progress.
Alireza Nourizadeh of the Centre for Arab and Iranian Studies in London told Reuters he thought it possible Britain would sever diplomatic relations with Tehran over the incident, which he believed had the backing of Iranian authorities.
"The regime believes Britain is in control, (that) what the Americans and Europeans are doing is directed by Britain, and therefore they did it," he said.
Claire Spencer, head of the Middle East program at London think-tank Chatham House, said it was a very sensitive moment in the Middle East, pointing out that Iran backs Syrian President Bashar al-Assad's government which has faced months of protests.
"This risks all sorts of over-spill effects should things spin out of control. So it's a very difficult moment for those arguing in favour of pursuing the diplomatic channel," she said.
Additional reporting by William Maclean; editing by Andrew Roche