U.S. President Barack Obama has approved new sanctions against Iran, saying there is sufficient oil in the world market to allow countries to cut Iranian crude imports.

According to Al Jazeera TV, Mr. Obama said in a statement on Friday that the global economic conditions, increased production (of crude oil) by some countries and “the existence of strategic reserves” meant U.S. allies boycotting Iranian crude would not be harmed by the sanctions.

Mr. Obama said he would “closely monitor” the global market to ensure it could accommodate a reduction in purchases of Iranian oil, RIA Novosti reported.

“I will closely monitor this situation to assure that the market can continue to accommodate a reduction in purchases of petroleum and petroleum products from Iran,” Mr. Obama was quoted as saying.

Iran has the world's third-largest oil reserves.

The sanctions are aimed at pressuring Iran to abandon its disputed uranium enrichment programme.

Western powers suspect Iran of seeking to create a nuclear bomb. Iran says the programme is designed solely for the production of civilian energy. Under a new law passed by the U.S., countries risk being cut off from the American financial system if they fail to show by June 28 a significant reduction in the amount of Iranian crude imports.

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