The Irish and British governments are today assessing the damage to the peace process following a second statement from the IRA yesterday warning of the "seriousness of the situation".
The IRA issued the warning to the Taoiseach and Mr Blair after it announced on Wednesday it had scrapped an offer to decommission all the organisation's weapons, an offer that was on the table during negotiations before Christmas.
In last night's statement, the group said the two governments were "trying to play down our [earlier] statement because they are making a mess of the peace process. Do not underestimate the seriousness of the situation."
Asked today if he thought the latest statement was a threat, the Taoiseach said he would not be commenting on it. "We never have commented for 30 years on IRA statements and we are not going to now", he said.
However, security chiefs are telling ministers that the IRA is not at the point of calling off its ceasefire and going back to violence.
Last night, Irish sources privately said the IRA appeared to have believed that Wednesday's statement would have caused near panic in Dublin and London. "When it didn't, they got annoyed, so they issued a second statement to make sure that people got the message," one source told The Irish Times, although adding that he did not believe it amounted to a declaration of a return to violence.
The Democratic Unionist Party's Ian Paisley Jnr portrayed their statement as a temper tantrum akin to a child throwing his toys out of the pram.
Infuriated, the IRA came out with a second statement warning that London and Dublin were trying to play down the importance of their statement.
Unionist MP Mr Jeffrey Donaldson said last night's statements was a worrying development. "We don't know why the IRA has issued this statement, if there is an implicit threat contained within it."
He said that it was certainly a "more menacing statement" than the one the issued the night before. But he said the message had to be sent to the republican leadership.
"We can't go back to the past, we can't go back to the violence, the bombing and the shooting that left so much hurt and pain in Northern Ireland over 35 years. That is not they way forward," he said.
SDLP leader Mr Mark Durkan said that the IRA was threatening the future of the peace process. "The IRA is coming close to saying 'don't dare criticise us or question us or the peace process gets it'," he said.
"What has been doing damage to the peace process has been the IRA's insistence on carrying on as a private army and the Provisional movement's arrogance that it can act as a jury on everyone else's political actions."
Ulster Unionist Sir Reg Empey, who met the government yesterday for talks about the process accused the IRA of making a petulant outburst. "This attempt to bully the community is showing the republican movement in the worst possible light," he said.
The IRA was accused of carrying out the December £26.5 million sterling Northern Bank raid in Belfast, a charge Sinn Féin leaders have denied.
But Chief Constable Hugh Orde said it was them, and yesterday the Independent Monitoring Committee sent a report to the two governments saying they agreed. That report is due to be published next week.
Even though Northern Ireland's power sharing government has been suspended for more than two years, the three-man IMC is believed to have suggested banning Sinn Féin from any executive cabinet for six months.
Secretary of State Mr Paul Murphy must now decide whether to invoke the punishment in the unlikely event of devolution be restored this side of the general election.