The US has said efforts by countries to set up special payment system to bypass its sanctions against Iran is counterproductive, comments which came after the European Union, in a major snub to the Trump administration, decided to set up a new mechanism to enable legal trade with Iran, without encountering American sanctions.
Earlier this year, the Trump administration had withdrawn from the 2015 Iranian nuclear deal and reimposed a series of tough sanctions on Iran.
While the first phase of sanctions is already in place, the sanctions would come into full force on November 4 and the US expects all countries, including India, to bring down their import of Iranian oil to zero by then.
The US government has made it clear that any country that continues to do business with Iran will be blocked from accessing the American banking and financial system.
However, the sanctions are not endorsed by the UN and it has been a traditional policy of India to enforce only UNSC-authorised sanctions.
Though India, one of the biggest importers of oil from Iran, has already reduced its import, it has indicated that it is unlikely to go down to zero given its massive energy needs. India and the US are currently in talks on this issue.
Meanwhile, on Monday, the EU had announced that it will create new payment channels to preserve oil and other business deals with Iran in a bid to evade US punitive measures.
Expressing disappointment over reports of the EU setting up a special payment system to bypass Iranian sanctions, Secretary of State Mike Pompeo in New York on Tuesday said, "I was disturbed and, indeed, deeply disappointed...This is one of the most counterproductive measures imaginable for regional and global peace and security."
By sustaining revenues to the regime, the EU is solidifying Iran's ranking as the number one state sponsor of terror and making it richer, he said, adding, "The decision is all the more unacceptable, given the litany of Iranian-backed terrorist activity inside Europe".
Mr Pompeo alleged Iranian President Hassan Rouhani and Foreign Minister Mohammad Javad Zarif Khonsari were brazenly defying the vision of the UN, the requirements of international and the principles of national sovereignty.
"The Iranian regime's track record over the past 40 years has revealed it as among the worst violators of the UN Charter and UN Security Council resolutions," he told a conference held on the sidelines of the annual UN General Assembly meeting.
Mr Pompeo said reimposing sanctions and discouraging international business with Iran is not something the US is doing "out of spite. This is a necessary security measure".
"Doing business in Iran only pours money into a regime that hoards it for itself and misuses it for violent ends," he said.
Later in the day, Special Representative for Iran Brian Hook told a press conference in New York that the private sector across the world has understood the US' sanctions message very clearly and "that's why major companies from Europe to Asia are getting out of Iran and terminating business".
"Companies have a choice to either do business in Iran or in the US. They are making those decisions based on what makes business sense. Potential deals with Iran are just pale in comparison with deals in the US," he said.
"There is more daylight between the European companies and the EU than that in between the US and our European allies," Mr Hook added.
He also said that the Trump administration is discussing the re-imposition of sanctions with countries on a case-by-case basis.
"Our energy sanctions don't go back into place until early November, and we are in discussions with countries on a case-by-case basis about the re-imposition of our sanctions and we are taking these things on a country-by-country basis, but I think everybody knows that our goal is to get the import of Iranian oil as close to zero as possible," Mr Hook said.
But before imposing sanctions on other countries, Mr Hook said that the US will ensure that it has a "well-supplied oil market".
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