Iran's president said the Islamic republic will resume high-level enrichment of uranium if world powers do not protect its interests against U.S. sanctions.
Hassan Rohani's address to the nation was aired by state television on May 8, the anniversary of President Donald Trump's decision to withdraw the United States from a landmark nuclear agreement.
The announcement further escalates tensions between Tehran and Western nations -- first and foremost, the United States, which this week said it was deploying an aircraft carrier battle group to waters near Iran.
Rohani said the remaining signatories of the 2015 accord -- Britain, France, Germany, China, and Russia – had 60 days to take measures to protect Iran's oil and banking sectors.
Western officials reacted cautiously to Rohani's announcement.
In London, U.S. Secretary of State Mike Pompeo, speaking alongside British Foreign Secretary Jeremy Hunt, said Washington will wait to see if Tehran follows through on its threats before deciding its next move.
The White House, meanwhile, announced new economic sanctions targeting Iran's steel, copper, aluminum, and mining sectors, all key sources of revenue for the country.
"Tehran can expect further actions unless it fundamentally alters its conduct," Trump said in a statement released by the White House. "I look forward to someday meeting with the leaders of Iran in order to work out an agreement and, very importantly, taking steps to give Iran the future it deserves."
In his speech, Rohani said Iran will start reducing some of its commitments under the 2015 nuclear deal and will no longer export enriched uranium and heavy water to other nations as stipulated in the accord.
He said Iran would begin to build up its stockpiles of low enriched uranium and of heavy water, which is used in nuclear reactors, including a reactor that could produce weapons-grad plutonium.
Three versions of domestically built centrifuges are shown in a live TV program from Natanz, an Iranian uranium enrichment plant, in June 2018
If the Europeans fail to compensate for the unilateral American sanctions, he said, Iran will resume construction of the Arak nuclear reactor, a facility that was shut down, and its key components dismantled.
"If the five countries join negotiations and help Iran to reach its benefits in the fields of oil and banking, Iran will return to its commitments according to the nuclear deal," Rohani said.
However, Rohani warned of a "strong reaction" if European leaders instead sought to impose more sanctions. He did not elaborate.
Iranian Foreign Minister Mohammad Javad Zarif also tweeted: "After a year of patience, Iran stops measures that [the United States] has made impossible to continue."
Other European signatories of the deal urged Iran to uphold the nuclear pact and said they want to keep the Iran deal alive.
French Defense Minister Florence Parly warned that if Iran did not keep its commitments, reimposing sanctions would be considered.
In Berlin, the office of German Chancellor Angela Merkel said: "We as Europeans, as Germans, will play our part and we expect full implementation from Iran as well.”
At his news conference with Pompeo, Hunt said that Iran's threat to resume higher enrichment of uranium is an "unwelcome step" and urged Tehran to adhere to the deal.
Russia, meanwhile, has blamed the United States for the crisis, a point Foreign Minister Sergei Lavrov repeated during a news conference in Moscow with Zarif.
“The U.S. is to blame for the situation and it makes it difficult for both Iran to fulfill its obligations and...for the general state of the nuclear nonproliferation regime,” Lavrov said.
Zarif insisted that Iran's latest decision did not violate the agreement, and asserted it was provoked by U.S. actions toward Iran. He said Iran will uphold its obligations if European signatories to the deal uphold theirs.
China, which was also a signatory to the deal, said maintaining and implementing "the comprehensive agreement is the shared responsibility of all parties.”
"We call on all relevant parties to exercise restraint, strengthen dialogue, and avoid escalating tensions," said Chinese Foreign Ministry spokesman Geng Shuang.
The 2015 nuclear pact, known as the Joint Comprehensive Plan of Action, lifted crippling economic sanctions in exchange for Tehran agreeing to curb parts of its nuclear program.
Last year, Trump announced the U.S. pullout, arguing it was flawed because it did not include curbs on Iran’s development of ballistic missiles or Tehran’s support for proxies in the Middle East.
Washington also reinstated sweeping sanctions that have badly hit the Iranian economy.
Despite the U.S. moves, Tehran has continued to comply with the terms of the deal, according to the International Atomic Energy Agency.
European backers of the deal have been trying to salvage the agreement, but Tehran has complained that the process is too slow.
Last month, the U.S. administration announced it would not permit importers of Iranian oil to buy it without facing U.S. sanctions. Oil exports are a major source of revenue for the Iranian economy.
On May 8, Tim Morrison, Trump's special envoy on weapons of mass destruction, threatened that the United States was ready to impose more sanctions "very soon" and warned European nations against doing business with Tehran.