Trump signed an executive order he said would curb access that Khamenei and the country have to world financial markets. Treasury Secretary Steven Mnuchin said the action would "literally" lock up "tens and tens of billions of dollars" of Iranian assets.
The U.S. leader called his order a "strong and proportionate" American response to Tehran's shoot-down last week of an unmanned U.S. drone, which Washington says occurred in international airspace near the Strait of Hormuz and Iran claims occurred over its airspace.
Trump at the last minute last Thursday rejected a military response to the downing of the drone upon learning that about 150 Iranians would be killed in a U.S. attack. In announcing the new sanctions, he said “I think a lot of restraint has been shown by us, but that doesn’t mean we’re going to show it in the future. But we'll give it a chance."
Trump said he imposed the sanctions because of a series of "belligerent acts" carried out by Iran, which U.S. officials say include Iran's targeting of Norwegian and Japanese ships traversing the Strait of Hormuz with mine explosions days before the attack on the drone.
The executive order is aimed at pushing Tehran back to one-on-one talks with the U.S. over its nuclear weapons program after Trump last year withdrew from the 2015 international pact restraining Iran's nuclear program in exchange for sanctions relief. Trump called the international deal negotiated by his predecessor, former President Barack Obama, "a disaster."
"We'd love to be able to negotiate a deal," Trump said.
But he declared, "Never can Iran have a nuclear weapon," adding, "They sponsor terrorism like no one's seen before."
He said, "I look forward to the day when sanctions can be lifted and Iran can be a peace-loving nation. The people of Iran are great people."
Mnuchin said earlier sanctions imposed when Trump pulled out of the international agreement have been "highly effective in locking up the Iranian economy. We follow the money and it's highly effective."
"Locking up the money worked last time and they'll work this time," Mnuchin said. The Treasury chief said the U.S. could target Iranian Foreign Minister Mohammad Javad Zarif, one of Tehran's best known figures on the world stage, with sanctions in the coming days.
He said some of the sanctions Trump imposed Monday had been "in the works" before the drone was shot down, and some were being imposed because of the attack on the drone.
The Treasury Department headed by Mnuchin said that in addition to Khamenei, the U.S. sanctions also targeted eight senior commanders in the Iranian military and the Islamic Revolutionary Guards Corps. It said that any foreign financial institution that engages in a "significant financial transaction" with the Iranians targeted by the sanctions could be cut off from U.S. financial deals.
Coalition to counter Iran
Secretary of State Mike Pompeo described the new sanctions as "significant" as he left Washington on Sunday for a trip to Saudi Arabia and the United Arab Emirates to continue the Trump administration's effort to build a coalition of allies to counter Iran. Pompeo met Monday with Saudi King Salman and Crown Prince Mohammed bin Salman.
"The world should know," Pompeo said, "that we will continue to make sure it's understood that this effort that we've engaged in to deny Iran the resources to foment terror, to build out their nuclear weapon system, to build out their missile program, we are going to deny them the resources they need to do that thereby keeping American interests and American people safe all around the world."
Iran has defended its missile work as legal and necessary for its defense. Tehran has sought support from the remaining signatories to the 2015 agreement to provide the economic relief it wants, especially with its key oil exports as the U.S. has tightened sanctions in an attempt to cut off Iranian oil shipments.
Trump said in a series of tweets Saturday about the sanctions that he looks forward to the day when "sanctions come off Iran, and they become a productive and prosperous national again -- The sooner the better!"