US-EU rift cracks wide open over Iran sanctions

Tensions between the United States and the European Union over Iran soared into the open Tuesday after the Europeans announced plans for a legal framework to preserve business with Tehran and evade new US sanctions.

In rhetorical exchanges that brought back memories of the feud over the 2003 Iraq invasion, the US denounced the Europeans, who, in turn, made clear they would not back down on diplomacy.

Britain, France and Germany -- along with Russia and China -- had all pleaded unsuccessfully for President Donald Trump to remain in the six countries' 2015 accord with Iran on ending its nuclear programme.

Full US sanctions are set to hit Iran in November and the country's economy is already taking a beating.

After talks Monday with Iranian Foreign Minister Mohammad Javad Zarif, EU foreign policy chief Federica Mogherini said the Europeans would set up a "legal entity" for businesses to transfer money without coming under Washington's scanner.

US Secretary of State Mike Pompeo, addressing a pressure group on the sidelines of annual UN meetings, said he was "disturbed and indeed deeply disappointed" by the EU announcement.

"This is one of the of the most counterproductive measures imaginable for regional and global peace and security," Pompeo said in a speech that was interrupted several times by anti-war protesters.

"By sustaining revenues to the regime, you are solidifying Iran's ranking as the number-one state sponsor of terror," said Pompeo, who quipped that Iran's "corrupt ayatollahs" and elite Revolutionary Guards had to be "laughing this morning".

John Bolton, Trump's hawkish national security adviser, mocked the EU for its lack of detail on the planned mechanism.

"The European Union is strong on rhetoric and weak on follow-through," he told the United Against a Nuclear Iran campaign.

"We do not intend to allow our sanctions to be evaded by Europe or anybody else," he said.

Bolton also issued unsubtle warnings to Iran's leaders: "We are watching, and we will come after you. If you cross us, our allies or our partners, if you harm our citizens, if you continue to lie, cheat and deceive, there will be hell to pay."