Britain has said its priority is to de-escalate tensions with Iran in the Gulf, and has called for the release of the Stena Impero oil tanker which was seized Friday in what Britain said was an illegal move in Omani waters.

"We are going to be looking at a series of options," Ellwood told Sky News television.

He denied Britain had been negligent in providing protection to its ships passing through the Gulf and said the Royal Navy was too small to manage UK interests around the globe.

The frigate HMS Montrose was in the Gulf when it was seized.

Asked on Sky News television if Britain had taken its "eye off the ball", Ellwood replied: "No, not at all."

He said British ships travelled through 100 nautical miles of waterway every day, adding: "It is impossible simply to escort each individual vessel."

Ellwood called for more money to be pumped into Britain's defence forces to be better able to respond to the range of threats against UK interests.

Britain gets a new prime minister on Wednesday when either Foreign Secretary Jeremy Hunt or his predecessor Boris Johnson takes over from Theresa May.

Hunt, the son of an admiral, has said he wants to increase defence spending from two percent of GDP to 2.5 percent.

"If we want to continue playing a role on the international stage -- bearing in mind that threats are changing -- all happening just beneath the threshold of all-out war, then we must invest more in our defence, including our Royal Navy," said Ellwood.

"Our Royal Navy is too small to manage our interests across the globe if that's our future intentions and that's something the next prime minister will need to recognise."

In a report published Sunday, a committee of parliamentarians scrutinising Britain's national security strategy also said the incoming prime minister should boost defence spending if he wants Britain to become a more significant global player.

It said May's "Global Britain" agenda was "meaningless" against a backdrop of "reduced diplomatic spending and under-powered defence".

The NATO target of spending two percent of GDP on defence may not be enough for Britain "in light of both the scale and range of threats to the UK and the costs involved in keeping pace with rapid technological change".