Countries trading with Iran will lose US business: Trump

US President Donald Trump warned other countries from doing business with Tehran on Tuesday, after reimposing what he described as the "most biting ever” sanctions.

"Anyone doing business with Iran will NOT be doing business with the United States. I am asking for WORLD PEACE, nothing less,” he wrote in an early morning tweet.

"The Iran sanctions have officially been cast. These are the most biting sanctions ever imposed, and in November they ratchet up to yet another level.” 

But the sanctions reimposed on Tuesday - targeting access to US banknotes and key industries such as cars and carpets - were unlikely to cause immediate economic turmoil. 

Iran's markets were actually relatively buoyant, with the rial strengthening by 20 percent since Sunday after the government relaxed foreign exchange rules and allowed unlimited, tax-free gold and currency imports. 

But a second tranche coming into effect on November 5 covering Iran's vital oil sector, could be far more damaging - even if several key customers such as China, India and Turkey have refused to significantly cut their purchases.

Trump's contempt for the nuclear deal dates back to his time as presidential candidate and on May 8, he made good on a pledge to pull America out of the international agreement.

The unilateral withdrawal came despite other parties to the agreement - Britain, China, France, Germany, Russia and the EU - pleading with Trump not to abandon the pact aimed at blocking Iran from acquiring a nuclear weapon.

On the other hand, the European Union foreign policy chief Federica Mogherini said the EU is encouraging enterprises to increase their business with Iran, noting Tehran has been compliant with its nuclear-related commitments.

"We are doing our best to keep Iran in the deal, to keep Iran benefiting from the economic benefits that the agreement brings to the people of Iran because we believe this is in the security interests of not only our region, but also of the world. If there is one piece of international agreements on nuclear non-proliferation that is delivering, it has to be maintained," Mogherini said.

'Makes no sense'

On Monday, Iran's President Hassan Rouhani said Washington's call for new nuclear negotiations while imposing crippling sanctions at the same time "makes no sense".

"They want to launch psychological warfare against the Iranian nation and create divisions among the people," he said in a televised interview.

"Negotiations with sanctions doesn't make sense. They are imposing sanctions on Iranian children, patients and the nation," the president said.

Rouhani referred to fears that essential supplies such as medicines would be affected when sanctions return on Tuesday.

He said Iran had "always welcomed negotiations" but that Washington would first have to demonstrate it can be trusted.

"If you're an enemy and you stab the other person with a knife and then you say you want negotiations, then the first thing you have to do is remove the knife."

"How do they show they are trustworthy? By returning to the JCPOA," he said, using the technical name for the 2015 nuclear deal.