Authorities in Gibraltar have rejected the latest US request not to release a seized Iranian supertanker, clearing the way for the vessel to set sail after it was detained last month for allegedly attempting to breach European Union sanctions on Syria.

The ship was expected to leave on Sunday night, according to a statement on Twitter by Hamid Baeidinejad, Iran’s ambassador to Britain.

The tanker’s release comes amid a growing confrontation between Iran and the West after President Donald Trump pulled Washington out of Tehran’s nuclear deal with world powers over a year ago.

Shortly after the tanker’s detention in early July near Gibraltar — a British overseas territory — Iran seized the British-flagged oil tanker Stena Impero, which remains held by the Islamic Republic.

The supertanker off Gibraltar
The supertanker off Gibraltar (Marcos Moreno/AP)

Analysts had said the Iranian ship’s release by Gibraltar could see the Stena Impero go free.

Gibraltar’s government said on Sunday it was allowing the Iranian tanker’s release because “the EU sanctions regime against Iran – which is applicable in Gibraltar – is much narrower than that applicable in the US”.

In a last-ditch effort to stop the release, the US unsealed a warrant on Friday to seize the vessel and its cargo of 2.1 million barrels of light crude oil, citing violations of US sanctions as well as money laundering and terrorism statutes.

US officials told reporters that the oil aboard the ship was worth 130 million dollars (£107 million) and that it was destined for a designated terror organisation to conduct more terrorism.

The unsealed court documents argued that Iran’s Islamic Revolutionary Guard Corps are the ship’s true owners through a network of front companies.

Authorities in Gibraltar said on Sunday that, unlike in the US, Iran’s Revolutionary Guard is not designated a terrorist organisation under EU, UK or Gibraltar law.

The Iranian ship was detained while sailing under a Panamanian flag with the name Grace 1. As of Sunday, it had been renamed the Adrian Darya 1 and had hoisted an Iranian flag. Workers were seen painting the new name on the side of the ship on Saturday.

Crew members rename the ship
Crew members rename the ship (Marcos Moreno/AP)

Iran has not disclosed the Adrian Darya 1’s intended destination and has denied it was sailing for Syria.

The chief minister of Gibraltar, Fabian Picardo, said he had been assured in writing by the Iranian government that the tanker would not unload its cargo in Syria.

Mr Baeidinejad said in a series of tweets that “round-the-clock efforts to carry out port formalities and deploy the full crew onto the ship” had taken place since Gibraltar lifted the vessel’s detention on Thursday.

The Astralship shipping agency in Gibraltar, which has been hired to handle paperwork and arrange logistics for the Adrian Darya 1, said a new crew of Indian and Ukrainian nationals were replacing the sailors on board.

Astralship managing director Richard de la Rosa said his company had not been informed about the vessel’s next destination.