U.S. says pushing allies to halt Iran oil imports, no exceptions

WASHINGTON (Reuters) - The United States is pushing countries to halt imports of Iranian oil from November, a senior State Department official said on Tuesday, and it will not grant any waivers to sanctions, a hardline position the Trump administration says is meant to cut off funding to Iran.

U.S. President Donald Trump in May said his administration was withdrawing from a 2015 nuclear deal agreed between Iran and six world powers aimed at curbing Tehran's nuclear capabilities in exchange for the lifting of some sanctions.

Asked if the United States was pushing allies to cut oil imports to zero by November, the official said "yes".

"We're going to isolate streams of Iranian funding and looking to highlight the totality of Iran's malign behavior across the region," the official, speaking on condition of anonymity, told reporters.

The official said a U.S. delegation was headed to the Middle East next week to encourage Gulf producers to ensure global oil supplies as Iran is cut out of the market starting on Nov. 4 when sanctions are reimposed. The group has yet to hold talks with China and India, among the largest importers of Iran's oil.

Benchmark U.S. oil futures rose more than $2 on Tuesday, topping $70 a barrel for the first time since May 25 as the threat that the United States would push buyers to limit Iranian oil imports added to concerns about tightening supplies.

Asked if any waivers were expected to be granted in the process, the official said: "No, we're not granting waivers."

Senior State Department and Treasury officials are pressing allies in Europe, Asia and the Middle East to adhere to the sanctions, which are aimed at pressuring Iran to negotiate a follow-up agreement with the West to halt its nuclear programs.

Iranian President Hassan Rouhani on Tuesday promised Iranians the government would be able to handle the economic pressure of new U.S. sanctions amid reports of a second day of demonstrations in protest at financial hardship and a weakening rial.

Fars news agency reported that parts of Tehran's Grand Bazaar were on strike for a second straight day. Reuters was not immediately able to confirm the report.

Washington has sought to emphasize that the protests are part of rising economic discontent among Iranians.

"There is a level of frustration that people have with regard to the regime activity and behavior, the enrichment of the military and clerical elite and the squeezing out of the life of the economy," the senior State Department official said.

"Iranians are tired of this situation, and this situation exists because of their regime's behavior," the official added.

(Reporting by Lesley Wroughton and Doina Chiacu; Editing by James Dalgleish)