Western powers are enacting new sanctions against Iran, following a recent report by the International Atomic Energy Agency which suggested that the regime in Tehran could soon have the ability to build nuclear weapons. According to an executive order issued by the White House to Congress on Monday, the United States will be "expanding sanctions to target the supply of goods, services, technology, or support…to Iran for the development of its petroleum resources and maintenance or expansion of its petrochemical industry." President Barack Obama said the new sanctions also designated “11 Iranian individuals and entities for their role in assisting Iran’s prohibited nuclear programs, including its enrichment and heavy water programs.”

However, the US is not planning to slap sanctions on Iran's central bank, despite calls from Republicans and Democrats in Congress, as well as French President Nikolas Sarkozy, to do so. Nonetheless, the Treasury Department is expected to designate Iran as a territory of "primary money laundering concern." Treasury Secretary Timothy Geitner said this "will send a warning that any transaction with Iranian banks could be supporting Iran's illegal activities. While US companies and individuals already are barred from doing business with Iran, the new designation would caution foreign governments and businesses on their dealings with Iranian financial institutions.

The British government said on Monday that its sanctions would target Iran’s financial system: "This measure will protect the UK financial sector from being unknowingly used by Iranian banks for proliferation related transactions," declared Finance Minister George Osborne in London. Iran's nuclear activities posed “a significant risk to the national interests of the UK and countries across the region," he explained.

European Union governments could reach a preliminary deal on Tuesday to add about 190 Iranian nationals and entities to a list of those targeted by asset freezes and travel bans, diplomats said. Canada said it would immediately ban the export to Iran of all goods used in the petrochemical, oil and gas industry as part of an international sanctions package.

An Iranian Foreign Ministry spokesman said the IAEA report and the sanctions would only make Iran more determined to purse the nuclear program. “If our people feel that enemies want to deprive them of their rights by threatening, bullying and adopting illegal and irrational methods, they will pursue the path that they have taken more united and more determined than ever," he was quoted by ‘Reuters’ as saying.

The Russian government also criticized the new sanctions against Iran's financial and energy sectors as "unacceptable", saying they would hurt the chances of renewing talks with Tehran over its nuclear program. "We again underline that the Russian Federation considers such extraterritorial measures unacceptable and contradictory to international law," a Foreign Ministry spokesman declared in Moscow.