Sarkozy Urges 'Unprecedented' Sanctions on Iran Nuclear Program

French President urges freezing overseas assets of Iran central bank, targeting oil industry; Netanyahu: Expected U.S. sanctions will show Tehran the dear price of nuclear ambitions.

France pushed for what it called "unprecedented" sanctions against Iran and its nuclear program on Monday, after both the U.K. and Canada announced their own measures against the Islamic Republic, and ahead of an expected U.S. announcement on further punitive measures.

The French statement came as Prime Minister Benjamin Netanyahu spoke on the phone with U.S. Secretary of State Hillary Clinton, who reportedly updated the premier on expected U.S. sanctions.

Sarkozy, Cameron - AP

While the details of those measure were not yet clear, Netanyahu said that the measures Clinton specified would "make it clear to the Iranians that the price of continuing their nuclear program will be dear."

In his statement on Monday, French President Nikola Sarkozy said that as "Iran steps up its nuclear program, refuses negotiation and condemns its people to isolation, France advocates new sanctions on an unprecedented scale to convince Iran that it must negotiate."

"France therefore proposes to the European Union and its member states, the United States, Japan and Canada and other willing countries to take the decision to immediately freeze the assets of the Iranian central bank [and] stop purchases of Iranian oil," the statement added.

Sarkozy's letter represents the clearest, most determined call to rally Western countries in an effort to penalize Iran for its nuclear ambitions, in an attempt perhaps to half further development of nuclear armament.

The French president's statement could also be seen as a last-ditch attempt by the West to prevent a military strike of Iran's military facilities, when and if it turns out that sanctions have run their course.

Most Iran specialists claim that it is only through an injury of the Islamic Republic's oil exportation enterprises, and through the freezing of foreign assists, that Tehran may be swayed to reconsider its nuclear ambitions.

The new EU measures will likely target industries such as shipping and will be formalized at a meeting of EU foreign ministers on Dec. 1, but discussions on possible further steps could take place in the coming days, diplomats said.

Earlier Monday, and ahead of a planned announcement of further U.S. sanctions against Iran, the U.K. and Canada stated they would join Washington in escalating financial measures against the Islamic Republic.

The steps come in response to a Nov. 8 report by the International Atomic Energy Agency (IAEA) that presented intelligence suggesting Iran had worked on designing an atomic bomb and may still be secretly carrying out related research. Iran says its nuclear work is entirely peaceful.

The range of unilateral steps planned by Western powers reflects the difficulty of persuading Russia and China not to veto further measures at the UN Security Council, where they have supported four previous sanctions resolutions.

While Britain ordered its financial institutions to stop all business with Iran, a source familiar with the sanctions said the steps would not directly target trade in Iranian oil.

"We believe that the Iranian regime's actions pose a significant threat to the UK's national security and the international community. Today's announcement is a further step to preventing the Iranian regime from acquiring nuclear weapons," said British finance minister George Osborne.

The United States has not bought Iranian oil since 1995, but it appeared unlikely the U.S. Treasury would try to now cut off the Iranian banking system entirely, a move that could disrupt global energy markets and harm U.S. economic recovery.

A U.S. official said the Treasury Department planned to designate Iran as an area of "primary money laundering concern" on Monday, a move allowing it to take steps to isolate the Iranian financial sector further.

The United States is also expected to unveil sanctions against Iran's petrochemical sector on Monday, sources familiar with the matter said on Friday.

It was unclear exactly what steps the U.S. Treasury plans, but the measures, which the U.S. official said were to be announced by Secretary of State Hillary Clinton and Treasury Secretary Timothy Geithner, appeared designed as a warning about the risks of dealing with Iran's financial institutions.

EU governments could reach a preliminary deal on Tuesday to add about 190 Iranian people and entities to a list of those targeted by asset freezes and travel bans, diplomats said.

Canada will immediately ban the export to Iran of all goods used in the petrochemical, oil and gas industry as part of an international sanctions package, the government said on Monday.