The dispute between the West and Tehran has sparked fears of a military confrontation that would disrupt vital oil supplies. Last week a U.S. newspaper report said Israel had practiced for a possible strike against Iran's nuclear sites.
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Energy experts are concerned any conflict in Iran could lead to a shutdown of the Strait of Hormuz, a narrow waterway separating Iran from the Arabian Peninsula through which roughly 40 percent of the world's traded oil is shipped.
Washington says it is focusing on diplomatic pressure to thwart Iran's nuclear ambitions but has not ruled out military action if that were to fail.
Iran's Revolutionary Guards warned the United States it would face a "tragedy" if it attacked the country.
"If you want to move towards Iran make sure you bring walking sticks and artificial legs because if you came you will not have any legs to return on," Mohammad Hejazi, a senior commander of the elite Guards, was quoted as saying.
Hejazi's comments followed market talk of a military strike against Iran's nuclear sites, which was denied by a senior Iranian nuclear official on Tuesday.
Foreign Secretary David Miliband stressed the importance of a diplomatic solution: "The diplomatic track has to work - the alternatives are appalling," he wrote in a commentary in the International Herald Tribune newspaper.
Iran's refusal to halt enrichment has drawn three rounds of limited U.N. sanctions since 2006 and the EU on Monday agreed new punitive measures targeting businesses and individuals the West says are linked to Iran's nuclear and ballistic programmes.
Deputy Foreign Minister Mahdi Safari said in an interview published on Wednesday that Iran, which is making windfall oil revenue gains, would transfer funds from the EU and invest elsewhere.
"If you withdraw more than $100 billion (50 billion pounds), then of course this will bring about a scarcity of money and have an impact on the world economy," Mahdi told Austrian daily Die Presse.
Europe would lose out as a result of the newly imposed measures, he said: "We have gas and oil resources everyone wants to buy. Now we are trading mostly with Asian countries."
