The US is planning to issue new Iran sanctions according to sources familiar with the issue. The tit-for-tat escalation follows Iran's test of a new missile.
US President Donald Trump is poised to impose new sanctions on multiple Iranian entities, seeking to ratchet up pressure on Tehran, people familiar with the matter said on Thursday.
The administration is preparing to roll out new measures against more than two dozen Iranian targets, the sources said. The announcement is expected as early as Friday, they added.
The new sanctions would be taken under existing executive orders covering terrorism and weapons of mass destruction.
The package targets both entities and individuals. But sources said it was formulated in a way that would not violate the 2015 Iran nuclear deal negotiated between Iran and six world powers including Trump's predecessor, Barack Obama.
The sources said the new sanctions had been in the works for some time and that Iran's decision to test-fire a ballistic missile on Sunday helped trigger Trump's decision to impose them, although Washington has not accused Iran of violating the nuclear deal.
Iran on Thursday rejected the US warning over the missile test as unfounded and "provocative," after the White House put Iran "on notice" following the test.
"Claims made by US President Donald Trump's National Security Advisor are baseless, repetitive and provocative," Iranian foreign ministry spokesman Bahram Ghasemi said.
Iran has confirmed that it tested a ballistic missile. But it says the missiles do not breach the nuclear deal as they are for defence purposes only and are not designed to carry nuclear warheads.
The impact of the new sanctions will be more symbolic than practical, especially as the move does not affect the lifting of broader US and international sanctions that the deal imposed. Also, few of the Iranian entities being targeted are likely to have US assets that can be frozen. US companies, with few exceptions, are barred from doing business with Iran.
Wrestling visas cancelled
Iran's Foreign Ministry has cancelled visas for the American wrestling team scheduled to take part in the world championships in Iran.
"Considering the policies adopted by the new US administration, the foreign ministry was inevitably forced to refuse travel by the US wrestling team to Iran," spokesman Bahram Ghasemi said on Friday.
The 2017 Wrestling World Cup - Men's freestyle - will be the last of a set of three Wrestling World Cups in 2017. It will be held in Kermanshah, Iran, from February 16-17.
The visa refusal comes after Trump barred all persons from seven countries from entering the US for 90 days and suspended the US Refugee Admissions Program for 120 days. The countries affected are Iran, Iraq, Syria, Sudan, Libya, Yemen and Somalia.