European countries say they want to preserve Iran's nuclear deal and have rejected "ultimatums" from Tehran after Iran scaled back curbs on its nuclear program and threatened moves that might breach the pact.
Iran announced steps on Wednesday to relax some steps that restrict its stockpiling of nuclear materials in response to new US sanctions imposed after Washington abandoned the world powers' 2015 accord with Tehran a year ago.
Tehran's initial moves do not appear to violate the accord yet. But President Hassan Rouhani said that unless the powers protect Iran's economy from US sanctions within 60 days, Iran would start enriching uranium beyond limits set by the deal.
"We reject any ultimatums and we will assess Iran's compliance on the basis of Iran's performance regarding its nuclear-related commitments...," read a statement issued jointly by the European Union and the foreign ministers of Britain, France and Germany, co-signatories of the deal.
"We are determined to continue pursuing efforts to enable the continuation of legitimate trade with Iran," they said on Thursday, adding that this included getting a special purpose vehicle aimed at enabling non-dollar business with Iran off the ground.
In response, Iranian Foreign Minister Mohammad Javad Zarif said on his Twitter account that EU countries should uphold their obligations in the nuclear deal with Iran and normalise economic ties despite US sanctions, "instead of demanding that Iran unilaterally abide by a multilateral accord".
The nuclear deal required Iran to curb its uranium enrichment capacity to head off any pathway to developing a nuclear bomb in return for the removal of most international sanctions. A series of more intrusive UN inspections under the deal have verified that Iran is meeting its commitments.
The administration of President Donald Trump quit the agreement a year ago and reimposed US sanctions, which it has ratcheted up this month, effectively ordering all countries to halt all purchases of Iranian oil or face their own sanctions.
The move creates a dilemma for Washington's European allies which say they share its concerns about Iranian behaviour - including a ballistic missile program and alleged involvement in various Middle East conflicts - but think the Trump administration's tactics are likely to backfire.
The European allies believe Trump's campaign to isolate the Islamic Republic plays into the hands of Tehran hardliners and undermines pragmatists within the Iranian leadership who want to open the country up to the world.
French President Emmanuel Macron called on Thursday for the nuclear deal to be extended to cover other issues of concern to the West, such as Iran's regional policies and ballistic missiles, rather than jettisoned.
"Leaving the 2015 nuclear agreement is a mistake because it is undoing what we have already done. That's why France is remaining and will remain a part of it and I deeply hope that Iran will remain," Macron said.
"We contributed to negotiating this deal. France at the time had even pushed for it to be more demanding than what the United States was ready to accept. It is a good deal and good base. It needs to be completed," he said.
German Chancellor Angela Merkel said the EU wants to avoid an escalation in the dispute and Tehran must recognise that it is in its own interests to remain committed to the deal.
