The United States said it stood with the people of Iran in their demands for regime reforms as it reimposed sanctions on Tehran's banking, energy and shipping industries on Monday.
The sanctions take effect six months after President Donald Trump pulled out of the 2015 Iran nuclear deal, saying the US could not prevent an Iranian nuclear bomb under the "decaying and rotten structure of the current agreement".
"An important component of our diplomacy is standing with the Iranian people, they are the longest-suffering victims of the regime's brutality and economic mismanagement. We stand with them as they call for the regime to respect their human rights and dignity," said US Special Representative for Iran, Brian Hook.
He said Washington believed the Iranian nation had lost their confidence in its clerical rulers.
"The Iranian people have had 39 years of economic mismanagement ... They know very well that their economic problems are caused by the Iranian regime and not the United States," Mr Hook said in a conference call with reporters.
He said the Iranian economy was struggling because of the government's "negligence of its own people”.
Tehran had ruined agricultural land by building dams and using its funds in places like Iraq, Syria and Yemen. Iran had spent $4.6 billion in Syria, given $700 million to Hezbollah, and sent hundreds of millions to the Houthis in Yemen, he said.
"The purpose of the sanctions is to diminish the regime’s capacity to threaten the region,” Mr Hook said, calling them "the toughest sanctions that have ever been imposed" on Iran.
He said the sanctions had cost Iran billions of dollars in oil revenue since May.
Outlining the scope of the sanctions in Washington, Secretary of State Mike Pompeo and Treasury Secretary Steven Mnuchin said more than 700 entities were targeted, many for the first time.
Mr Pomeop also identified eight countries that were granted exemptions to temporarily continue buying Iranian oil - China, India, Greece, Italy, Taiwan, Japan, Turkey and South Korea.
The sanctioned Iranian entities include 50 Iranian banks, 200 individuals, vessels tied to Iran’s shipping and energy sector, and more than 65 Iranian aircraft. According to the US Treasury, the sanctions brings the total number of Iran-related targets to 900, the highest ever.
Mr Pompeo said more than 20 countries had already cut their oil imports from Iran. This has reduced purchases by more than 1 million barrels per day and has cost Iran $2.5 billion in oil revenue since May, he said.
“Treasury’s imposition of unprecedented financial pressure on Iran should make clear to the Iranian regime that they will face mounting financial isolation and economic stagnation until they fundamentally change their destabilising behaviour,” Mr Mnuchin said in a statement. He said the pressure “is only going to mount from here” unless Iran’s leaders halt its support for terrorism and abandon its nuclear ambitions “immediately”.
The resumption of sanctions prompted an air defence drill and an acknowledgement from President Hassan Rouhani that the nation was facing a "war situation".
But as Mr Rouhani stepped up the rhetoric, comparing Iran's current situation with the 1980s war against Iraqi dictator Saddam Hussein, Iran's foreign ministry shrugged off the re-imposition of sanctions, saying it was nothing new and that the country had gone through a wider range of sanctions in the past.
The ministry's spokesman, Baharam Ghasemi said the sanctions would backfire and work against the US and that "many countries from Europe to Russia and China have opposed the sanctions."
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Britain said on Monday it regretted the decision to reimpose sanctions on Iran. "We continue to believe that the Iran nuclear deal makes the world a safer place and our position remains that as long as Iran continues to meet its obligations under the deal by respecting strict limits on its nuclear activity, we will be committed to it too," Prime Minister Theresa May's spokesman said.
Similarly, China also expressed its regret, but said it would continue to uphold the nuclear deal Beijing agreed to as a permanent member of the United Nations Security Council. Foreign Ministry spokeswoman Hua Chunying said the international community objects to unilateral sanctions like these.
Meanwhile in Israel Defence Minister Avigdor Lieberman called sanctions the "change the Middle East has been waiting for."
Israel has been a fierce opponent of the 2015 nuclear deal, saying it didn't rein in Iran's regional military activities.
Back in Iran civilians are already reeling from the sanctions, with some business owners saying their sales have dropped 90 per cent since May and a massive brain drain is in act among younger generations.
The hopes of Iranians who endured a decade of sanctions and looked to the 2015 nuclear deal as a promise of better living standards have been dashed. Even before the measures took effect today, the national currency had lost about 70 percent of its value against the dollar.