Britain on Wednesday ordered Iran's embassy in London closed after Basij militia members ran amok through its own mission in Tehran, prompting the evacuation of all its diplomats.
Several European nations, including France, Germany and Italy, recalled their ambassadors in a show of solidarity, and the European Union on Thursday declared it would take "appropriate measures" to hit back at what it saw as an attack on the EU as a whole.
"The live TV images of this assault clearly organised by the regime provoked a shock that will weigh for a long time on the already bad relations between Tehran and the Europeans," said one EU ambassador who declined to be identified because of the diplomatic tensions.
The new crisis has erupted as Iran struggles with severe international sanctions already in place over its controversial nuclear programme, which has been condemned by the UN Security Council.
The United States and the European Union this week announced a hardening of their economic and financial measures against Iran, following a November report by the UN nuclear watchdog expressing "serious concerns" about a possible military dimension to the programme, which Tehran has denied.
The sanctions, which are starting to be felt in the oil sector -- which accounts for 80% of foreign revenues for Iran, the second-biggest exporter in the OPEC producers' cartel -- could be extended to its central bank and even see an embargo on oil sales.
Western nations have also exerted pressure over Iran's human rights record, since severe repression against dissidents and protesters following the disputed re-election of President Mahmoud Ahmadinejad in 2009.
A UN special rapporteur tasked with looking into the issue has filed a series of critical reports which a furious Tehran has slammed as politically biased.
Iranian support for opposition demonstrations led by its co-religionists among the Shiite majority in Bahrain has also reignited tensions between Tehran and its Sunni-ruled Gulf Arab neighbours -- chief among them Saudi Arabia, which has accused Iran of "meddling".
The parlous relations with Saudi Arabia were worsened in October, when the United States implicated Iranian officials in an alleged plot to assassinate the Saudi ambassador to Washington -- another accusation Iran denies.
"The degradation of ties with Saudis is long-lasting and could totally wipe out the Iranians' hope of closer relations with the Arab world after the recent regime changes seen in several countries," one Arab diplomat in Tehran said soon after the US plot allegation came to light.
Iran's isolation could also grow if the regime in Syria -- Tehran's main regional ally -- is toppled by the persistent protests there.
The loss of Syria would complicate Iran's access to other allies -- the Hezbollah militia in Lebanon, and Hamas in the Palestinian territories. It would also diminish Iran's influence in the region, several European and Arab diplomats predicted.
The issue of Syria also has an effect on Iran relations with Turkey, which has taken a firm position in favour of regime change in Damascus.
Ties with Ankara, which Tehran has made a priority in a bid to get around Western sanctions, have been jeopardised by the recent installation in Turkey of a NATO anti-missile shield which is expressly designed to counter an Iranian threat.
Officials in Iran -- notably within its powerful Revolutionary Guards -- have gone so far as to warn that NATO facilities in Turkey could be attacked, prompting worries in Ankara.
Even relations with Russia and China -- two permanent UN Security Council members that have been resisting Western efforts to totally isolate Iran over its nuclear programme -- are not immune from tensions.
Tehran is unhappy with Moscow for previously voting against Iran in the United Nations, for cancelling a sale of anti-aircraft missiles, and for repeated delays in Russia's project to help build Iran's nuclear power plant in Bushehr.
China, which has become Iran's principal trade partner in the vacuum left by the departure of Western firms, has in recent months also been the subject of complaints from Iran for dragging its feet on promises to invest 40 billion dollars in oil and gas projects.