Trump firm as US set to reimpose sanctions on Iran

US President Donald Trump told Iran on Monday to change its "destabilising" behaviour or risk further economic isolation, hours before the reimposition of sweeping sanctions against Tehran, though he left the door open to a new nuclear deal.

After Trump pulled Washington out of the historic 2015 multilateral accord in May, to the consternation of his European partners, a new pact seemed unlikely in the short term, given his conditions -- and Tehran's anger.

Against a backdrop of political turmoil and protests in Iran, Foreign Minister Mohammad Javad Zarif himself accused Trump of "bullying" and of being isolated in his hostility to the Islamic Republic.

A first phase of US sanctions against Iran goes into effect overnight, targeting Iran's access to US banknotes and key industries including cars and carpets.

"The Iranian regime faces a choice," Trump said in a statement. "Either change its threatening, destabilising behaviour and reintegrate with the global economy, or continue down a path of economic isolation."

"I remain open to reaching a more comprehensive deal that addresses the full range of the regime's malign activities, including its ballistic missile programme and its support for terrorism," the Republican leader added.

Renewed US hostility has already sparked a run on Iran's currency, which has lost around half its value since Trump's announcement.

It has added to tensions inside Iran, which has seen days of protests and strikes in multiple towns and cities over water shortages, high prices and wider anger at the political system.

Severe reporting restrictions have made it impossible to verify the swirl of claims coming through social media, though journalists confirmed a heavy build-up of riot police on Sunday night in the town of Karaj, just west of Tehran, that has been a focal point of unrest, and said mobile internet had been cut in the area.

Zarif lashed out at Trump, but acknowledged there were difficult times ahead.

"Of course, American bullying and political pressures may cause some disruption, but the fact is that in the current world, America is isolated," Zarif told reporters, according to the semi-official ISNA news agency.

The second phase of US sanctions, which takes effect November 5 and will block Iran's oil sales, is due to cause more damage, though several countries including China, India and Turkey have indicated they are not willing to entirely cut their Iranian energy purchases.

EU diplomatic chief Federica Mogherini said the bloc, as well as Britain, France and Germany, deeply regretted the move by Washington.

"We are determined to protect European economic operators engaged in legitimate business with Iran," she said in a statement.

But many large European firms are leaving Iran for fear of US penalties.

"Individuals or entities that fail to wind down activities with Iran risk severe consequences," Trump said.

Iranian President Hassan Rouhani in reply to US threat said on Monday that US was launching a "psychological warfare" against Iran. "They want to launch psychological warfare against the Iranian nation and create divisions among the people," he said.