Theresa May will chair a meeting of the government's emergency committee Cobra today after Iran "illegally" seized a British-flagged oil tanker in the Strait of Hormuz.
She is expected to receive updates from ministers and officials on the situation, and will discuss the maintenance of the security of shipping in the region.
Foreign Secretary Jeremy Hunt will also update the Commons on the situation, amid reports that ministers are considering freezing Iranian regime assets.
He is expected to tell MPs what further measures the government will take.
On Sunday, new audio was released of the Iranian Revolutionary Guard and the Royal Navy both giving instructions to the Stena Impero before it was seized by Tehran.
In the recording, an Iranian officer can be heard telling the vessel: "If you obey, you will be safe.
"Alter your course to 360 degrees immediately, over."
After that message, a British officer from the frigate HMS Montrose patrolling the area around the Strait of Hormuz communicates with the Stena Impero, saying: "This is British warship F236.
"I reiterate, that as you are conducting transit passage in a recognised international strait, under international law your passage must not be impaired, impeded, obstructed or hampered.
"Please confirm you are conducting transit passage in a recognised international strait."
The Royal Navy later ask the Iranians to "please confirm that you are not intending to violate international law by unlawfully attempting to board the MV Stena."
The Iranians then repeat their request for the tanker to turn around.
The audio was released by maritime security risk firm Dryad Global.
Earlier on Sunday, state media in Iran confirmed all crew members of the Swedish-owned Stena Impero were "safe and in good health in Bandar Abbas port."
The British-registered ship's crew is made up of Indian, Latvian, Filipino and Russian members.
Iran's ambassador to the UK waded into the row, saying that Iran "is firm and ready for different scenarios."
Hamid Baeidinejad tweeted: "UK government should contain those domestic political forces who want to escalate existing tension between Iran and the UK well beyond the issue of ships.
"This is quite dangerous and unwise at a sensitive time in the region. Iran however is firm and ready for different scenarios."
The Iranian Foreign Minister Javad Zarif has also waded into the crisis by blaming the US, saying: "Make no mistake:
Having failed to lure @realDonaldTrump into War of the Century, and fearing collapse of his #B_Team, @AmbJohnBolton is turning his venom against the UK in hopes of dragging it into a quagmire.
"Only prudence and foresight can thwart such ploys."
Tobias Ellwood told Sky News that the UK is looking at sanctions against Iran over the issue.
When asked about sanctions by Sky's Sophy Ridge on Sunday, the defence minister said "We are going to be looking at a series of options".
On Saturday, the UK said the seizure "constitutes illegal interference", in a letter to the United Nations Security Council.
The Stena Impero was in Omani territorial waters and was "exercising the lawful right of transit passage in an international strait", Britain's UN mission wrote in the letter.
Iran suggested the seizure was in response to the UK's role in detaining a tanker carrying Iranian oil earlier this month, despite initially saying the British-flagged tanker was held because it collided with an Iranian fishing boat.
A spokesperson for Iran's Guardian Council said "the rule of reciprocal action is well-known in international law".
Iranian state media earlier released footage showing the moment the Stena Impero was seized.
In the footage, armed troops wearing ski masks are seen rappelling onto the ship's deck from a helicopter hovering overhead.