The comments by government spokesman Gholamhossein Elham came a few days after Iranian missile tests heightened regional tension and helped send world oil prices to record highs.
Israel staged an air force exercise last month that stoked speculation about a possible assault on Iranian nuclear sites.
Iran, the world's fourth-largest oil exporter, has vowed to strike back at Tel Aviv and U.S. interests and shipping in the region if it is attacked, threatening to close the Strait of Hormuz, conduit for about 40 percent of globally traded oil.
"We do not imagine that anybody would commit such madness and stupidity ... and nobody has the power to make such aggression," the state broadcaster quoted Elham as saying.
"The Islamic Republic of Iran is not a threat at all and will not accept any threats."
Iran says its nuclear projects are aimed only at generating electricity. Western nations and Israel fear the Islamic Republic is seeking to build bombs.
Washington has said it wants diplomacy to end the row but has not ruled out military action should that fail.Israel, long assumed to have its own atomic arsenal, has sworn to prevent Iran from emerging as a nuclear-armed power.
Iran's Foreign Minister Manouchehr Mottaki said he believed neither of Tehran's arch-foes would want to get entangled in a new Middle East crisis by launching strikes against his country.
"The Zionist regime is still involved in the aftershocks of the war with Lebanon," he told the IRNA news agency, referring to Israel's inconclusive 2006 war with Hezbollah guerrillas.
"And the U.S. still does not possess the capacity to enter another crisis in the Persian Gulf region."
"RENEWED STRENGTH"
Elham said the aims of this week's wargames, during which Iran says it fired missiles that could hit Israel and U.S. bases in the region, included strengthening its military readiness.
Analysts say any U.S. or Israeli attack on Iran would be limited to air strikes, rather than a full-scale attack with U.S. ground forces, which are tied down in Iraq and Afghanistan.
They say Iran could respond with unconventional tactics, such as deploying small craft to attack ships, or using allies in the area to strike at U.S. or Israeli interests.
The United States and five other major powers have offered Iran economic and other benefits if it halts its most sensitive atomic activities, something Tehran says it will not do.Iran's chief nuclear negotiator Saeed Jalili is expected to meet European Union foreign policy chief Javier Solana in Geneva on July 19 for talks on the long-running dispute.
Elham said Iran was ready for talks in "fair conditions" but would not accept giving up what it sees as its nuclear rights.
Iran's oil minister said the country would press ahead with "renewed strength" in developing a major gas field in the Gulf, a few days after French firm Total said it would not invest in the South Pars Phase 11 project for now over political tension.
The United Nations and Western countries have stepped up sanctions on the Islamic Republic over its nuclear plans, which analysts say is deterring foreign investors.
Tehran says its windfall oil earnings will enable it to carry out projects on its own and also that it will find other firms particularly from energy-hungry Asia to invest.
"Upon hearing the news, we began work in this phase with renewed strength and we will continue that with strength," Oil Minister Gholamhossein Nozari told IRIB.
(Additional reporting by Hashem Kalantari; Writing by Fredrik Dahl; Editing by Sami Aboudi)
Original Source : http://uk.reuters.com/article/usTopNews/idUKL1246593220080712?pageNumber=1&virtualBrandChannel=0
