Iran is now enriching more uranium than it was before agreeing to a nuclear accord with world powers in 2015, Irans president declared as he rejected a proposed new Trump deal that could save it from sanctions.
Hassan Rouhani, in a televised speech on Thursday, said pressure has increased on Iran but we continue to progress" after Britain, France and Germany triggered a dispute resolution in response to Irans violations of the terms of the agreement.
Iran has gradually scaled back its commitments under the nuclear deal in retaliation to USs withdrawal from the pact in 2018 and its reimposition of sanctions that have crippled the country's economy.
Tehran has since resumed research and development of centrifuges, which European governments fear will lead to irreversible technological breakthroughs and reduce the "break-out" time Iran would need to build a nuclear bomb.
So far, Tehran has only modestly increased its nuclear activity. In recent months it has boosted its enrichment of uranium to 4.5 per cent -higher than the 3.67 per centlimit set by the agreement but far from the 20 per centenrichment it was engaged in before the deal. Uranium must be enriched to 90 per centto be used in a nuclear weapon.
Britain, France and Germany, known as the E3, had until now resisted US demands that they too quit the deal, insisting it is the only way to keep Iran in check.
UK Prime Minister Boris Johnson, who has praised President Donald Trump as a great deal-maker, called on Tuesday for the president to replace Iran's pact with major powers with his own one.
Mr Rohani dismissed the proposal for a new deal aimed at resolving the row, saying it was a "strange" offer and criticised Mr Trump for always breaking promises.
"The government is working daily to prevent military confrontation or war," Mr Rouhani added, saying that dialogue with the international community was difficult but remained "possible".
It came amid reports that days before the E3 triggered the mechanism, which if not resolved could see a snap back of global sanctions on Tehran, the Trump administration has threatened to impose a 25 per cent tariff on European car imports unless they took action against Iran for defying its nuclear agreement.
Though Mr Trump has previously made threats to place such a duty on Europes export of automobiles, the intent behind them was to receive better terms for Washington within the US-European trade relationship, not to shift European foreign policy, according to the Washington Post.
It was not clear if the threat was necessary since the Europeans had signalled an intention to trigger the dispute mechanism for weeks
The foreign ministers of the E3 said that they acted because Iran had been gradually scaling back its pledges under the deal, known as the JCPOA, since May last year.
We have therefore been left with no choice, given Irans actions, they said in a statement.
The Telegraph understands that they had first seriously discussed such a move in December.
It was taken last week after Iran announced it was suspended all limits on centrifuge installation and uranium enrichment under the JCPOA under its "fifth and final" step back from the agreement.
Mohammad Javid Zarif, Iran's foreign minister, said that Britain and its partners had succumbed to US threats when they triggered the dispute mechanism and likened Washington to a high-school bully.
"Appeasement confirmed. E3 sold out remnants of #JCPOA to avoid new Trump tariffs. It won't work my friends. You only whet his appetite. Remember your high school bully?" he wrote on Twitter. "If you want to sell your integrity, go ahead. But DO NOT assume high moral/legal ground."
Carl Bildt, co-chair of the European Council on Foreign Relations, also responded, writing: The US has now started to use what is described as mafia-like tactics in its dealings with European countries on the Iran issue. It simply does not tolerate the foreign policy independence of EU countries.