17 February 2011 Last updated at 11:30 GMT
Plans by two Iranian warships to pass through the Suez Canal into the Mediterranean have been cancelled, says an Egyptian official.
The unnamed official was reported as saying the plans had been withdrawn, without giving a reason.
He said the ships were near the Saudi Red Sea port of Jeddah.
Israel had reacted angrily to the plans, with Foreign Minister Avigdor Lieberman warning that it could not "forever ignore these provocations".
He said the vessels were planning on sailing to Syria - an arch Israeli opponent in the region - though this has not been confirmed by Iranian authorities.
Headache
The Suez Canal Authority was "informed today about the cancellation of two scheduled trips of two Iranian warships and no new date was set to cross the Suez", an Egyptian canal official, who declined to be named, told Reuters news agency.
The official identified the ships as the Alvand (a frigate) and the Kharg (a supply vessel).
However, the official Egyptian news agency Mena released a report quoting the Suez Canal Authority as denying it had banned the passage of the ships.
Ships must give the waterway's authority at least 24 hours' notice of their intention to use the canal, but no Iranian application to use the canal had ever been received, Mena quoted Ahmad al-Manakhli, head of the canal operations room, as saying.
Analysts say the plan had presented a headache for the new military leadership in Egypt, which signed a peace treaty with Israel in 1979 and has since had cold ties with Tehran.
Permission from the Egyptian defence and foreign ministries is required for warships to use the canal, but is only rarely withheld.