Obama said the new sanctions were the toughest ever passed by the U.S. Congress and would make it harder for Iran to buy refined petroleum as well as goods and services to modernize its oil and natural gas sector, the mainstay of its economy.

While the door to diplomacy remained open, he said, Iran would come under even greater international pressure if it continued to defy international calls to halt its uranium enrichment program.

The United States and its European allies suspect Iran is trying to build an atomic bomb, despite Tehran's insistence that its nuclear program is for the peaceful generation of electricity.