Answer: Are
Here's why:
The sentence is in the Present Continuous tense, used to describe actions happening now. In this tense, the verb "to be" (am, is, are) is used as an auxiliary verb along with the main verb ending in "-ing".
* "Is" is used with singular subjects (he, she, it).
* "Am" is used with "I".
* "Are" is used with plural subjects (we, you, they).
* "Can" is a modal verb and doesn't fit in this context.
Since the subject is "we" (plural), the correct form of the verb "to be" is "are". Therefore, the correct sentence is: "Are we swimming in the sea?"