US President Donald Trump decided not to reissue Iran oil waivers when they expire in May, a White House statement said.
The statement added that the US, Saudi Arabia, and the United Arab Emirates “have agreed to take timely action to assure that global demand is met as all Iranian oil is removed from the market.”
The United States announced it would no longer grant sanctions exemptions to Iran's oil customers, potentially punishing allies such as India as it tries to squeeze Tehran's top export.
“This decision is intended to bring Iran's oil exports to zero, denying the regime its principal source of revenue,” the White House said in a statement.
“The Trump administration and our allies are determined to sustain and expand the maximum economic pressure campaign against Iran to end the regime's destabilizing activity threatening the United States, our partners and allies and security in the Middle East,” it said.
Eight governments were initially given six-month reprieves from the unilateral US sanctions on Iran. They include India, which has warm ties with Washington but disagrees on the US insistence that Iran is a threat.
Other countries that will be affected include China and Turkey, opening up new friction in contentious relationships if the United States goes ahead with sanctions over buying Iranian oil.
The others- Greece, Italy, Japan, South Korea, and Taiwan- have already heavily reduced their purchases from Iran.
Trump last year withdrew the United States from an accord negotiated by his predecessor, Barack Obama, under which Iran drastically scaled back its nuclear program in return for promises of sanctions relief.
US officials say that they are aiming at choking off Iranian revenue to reduce the clerical regime's regional clout, notably its support for militants groups such as Lebanon's Hezbollah.