Iranian state television has been showing what it says is drone wreckage retrieved at sea.
Congressional leaders were briefed on the incident and called for a robust response, but they also told the president to act with caution.
So what does this mean for an already tense region?
Presenter: Peter Dobbie
Mohammad Marandi – head of American Studies at the University of Tehran
Hillary Mann Leverett – CEO of the political risk consultancy Stratega and a former US State Department