President Donald Trump wants to reinstate all US sanctions on Iran removed under the 2015 nuclear deal.
The White House said it was “the toughest sanctions regime ever imposed” on Tehran. The sanctions target both Iran and states that trade with it.
However, temporary waivers will be granted to eight countries to allow them to continue importing Iranian oil.
Iran’s Supreme Leader Ayatollah Ali Khamenei said the move “disgraced” US prestige and liberal democracy.
He tweeted on November 3: “The challenge between the US and Iran has lasted for 40 years so far and the US has made various efforts against us: military, economic and media warfare.”
“This new US president has disgraced the remnant of America’s prestige,” he said, adding that “America today is far weaker”, suggesting that US military power was beginning to “wane and deteriorate”.
The sanctions will be reintroduce on Monday, November 5.
Meanwhile, EU states that backed the nuclear deal have said they will protect EU companies doing “legitimate” business with Iran.
President Trump withdrew from the agreement in May, describing it as “defective at its core” because it had not stopped Iran developing a ballistic missile program and intervening in neighboring countries.
The president tweeted after the announcement: “Sanctions are coming,” referencing the TV series Game of Thrones and its motto “Winter is coming”.
The US has been gradually re-imposing sanctions, but analysts say this move is the most important because it targets the core sectors of Iran’s economy.
The agreement saw Iran limit its controversial nuclear activities in exchange for sanctions relief.
The US sanctions will cover shipping, shipbuilding, finance and energy.
More than 700 individuals, entities, vessels and aircraft will be put on the sanctions list, including major banks, oil exporters and shipping companies.
Treasury Secretary Steven Mnuchin also said that the Brussels-based Swift network for making international payments was expected to cut off links with targeted Iranian institutions.
Being disconnected from Swift would almost completely isolate Iran from the international financial system.
They are the second lot of sanctions re-imposed by President Trump since May.
Secretary of State Mike Pompeo set out 12 demands that Iran must meet if sanctions are to be lifted – including ending support for militants and completely ballistic missile development.
Mike Pompeo did not name the eight countries that been granted waivers to continue importing Iranian oil.
The secretary said the eight had “demonstrated significant reductions in their crude oil and co-operation on many other fronts”. Two would eventually stop imports and the other six greatly reduce them, he added.
US allies such as Italy, India, Japan and South Korea are among the eight, the Associated Press reports. Turkey also obtained a waiver, Reuters says.
All have been have been top importers of Iranian oil.
Iran’s foreign ministry spokesman Bahram Qasemi told state TV that Iran had “the knowledge and the capability to manage the country’s economic affairs”.