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Donald Trump's new hostile approach to Iran and Tehran's provocative response through further missile testing are both worrying steps that may escalate to a military conflict, a senior Arab official told °®Âþµº, warning that a war may be looming in the horizon.

The senior official, who spoke on the condition of anonymity, said he has met with members of the new US administration.

Trump's America wants a tougher approach to Iran, the senior official told °®Âþµº, adding that military action is "possible and has not been ruled out".

The Trump administration wants to make it clear that America's "softer" approach to Iran under Barack Obama has come to an end.

"There have been some revelations over the policies of the new administration towards Iran, although not much is clear yet over Syria, Iraq and Palestine," the official said.

Relations between Washington and Tehran have deteriorated sharply since Trump took office last month, promising a tough line on what he sees as Iranian belligerency towards US interests and allies.

"Iran is playing with fire - they don't appreciate how 'kind' President Obama was to them. Not me!" Trump tweeted.

US intelligence and Treasury officials have been scrutinising Iran's networks, looking for evidence of extremist funding and advanced weapons procurement.

US intelligence and Treasury officials have been scrutinising Iran's networks, looking for evidence of extremist funding and advanced weapons procurement.

Last week, Trump imposed fresh sanctions on Iran over a January 29 ballistic missile test and officials warned more might follow.

"We are undertaking a larger strategic review," a senior US administration official said, "The launch of the missile was the triggering event."

Washington has also been concerned over Iran's role in regional conflicts, most notably in Syria and Yemen.

Last weekend, new Pentagon chief James Mattis described the Islamic Republic as "the single biggest state sponsor of terrorism in the world."

The Trump administration's initial moves send a message to Tehran that the nuclear deal is on the verge of collapse, said former US ambassador to the United Nations John Bolto.

Nuclear deal 'Heartbeat away' from collapse

The Trump administration's initial moves send a message to Tehran that the nuclear deal is on the verge of collapse, said former US ambassador to the United Nations John Bolton.

"Let me give you my interpretation of what 'on notice' means. I think it means that the [nuclear deal] is about one heartbeat away from disappearing," Bolton added, in reference to Trump's recent remarks.

"This is a one-day agreement that we're renewing day-by-day, and it's that close to disappearing entirely," he said.

Bolton, who is known for his pro-Israel bias, was speaking during an event hosted by the Jewish Institute for National Security Affairs and United Against Nuclear Iran.

"If we designate the Revolutionary Guard Corps as a terrorist organisation, which should have happened about 10 years ago, maybe the Iranians will throw up their arms and say, 'It's an outrage, we're withdrawing from the agreement,'" he said.

The Trump administration is reportedly considering designating Iran's Islamic Revolutionary Guard Corps (IRGC) as a foreign terrorist organisation. The IRGC's overseas arm, known as the Qods Force, is already designated as such.

For Iran's hardliners, the US has always been inherently committed to overthrow the Islamic Republic, since its foundation in 1979.

Nothing new under the sun

But for Iran's hardliners, the US has always been inherently committed to overthrow the Islamic Republic, since its foundation in 1979.

On Friday, millions of Iranian rallied to mark the 38th anniversary of the revolution, burning US flags and chanting "Death to America".

Iranian President Hassan Rouhani warned against any threats made to his country.

"Anyone threating Iran's government and armed forces should know that our nation is vigilant," Rouhani said.

Iran-US relations have been highly hostile since the inception of the Islamic republic, with matters detiorating rapidly after the seizure of the US embassy in Tehran and the subsequent hostage crisis between 1979 and 1981.

The post-revolutionary Iranian government repeatedly blamed the US for meddling in Iranian affairs over the previous decades, most notoriously in the CIA-backed overthrow of Iranian nationalist Prime-Minister in 1953.

The US similarly majorly backed Saddam Hussein in the eight-year Iraq-Iran war and launched attacks against Iranian sea vessels culminating in the downing of an Iranian passenger airliner in 1988.

The US meanwhile has blamed Iran as a major state-sponsor of international terrorism, including attacks against US marine barracks in Beirut in 1983 and the Khobar bombings of 1996, as well as arming and financing anti-US and anti-Israel groups elsewhere.

In 2002 US President George W. Bush described Iran as forming part of the "Axis of Evil" for it's support of terrorism and pursuit of weapons of mass-destruction.

US opposition to Iran's nuclear-program saw increasing US-led sanctions against Iran from the 1990's onwards.

The nuclear deal between Iran and world powers in 2015 signalled a major shift in Iran-US relations, but one that has come under particularly attack by the new Trump administration.