RATCHETING UP PRESSURE
The widening sanctions regime is already doing significant damage to the Iranian economy, notably due to an oil embargo imposed by the European Union this year and new financial sanctions applied by the United States.
Riots have broken out in Tehran this month in protest at the collapse of the rial currency, which has lost some two-thirds of its value against the dollar in the past 15 months, stoking inflation that is now running at around 25 percent.
The new European measures include a general ban on financial transactions, with some exceptions for those involving humanitarian aid and provisions for legitimate trade.
Reversing existing policy, the ban will require European traders to ask governments for authorization before they can finance transactions in permitted goods. Previously, the EU broadly allowed trade unless goods were specifically banned.
"The EU's ban on financial transactions moves the Europeans to a more effective approach," said Mark Dubowitz of the Washington-based Foundation for the Defense of Democracies.
Trade will be hampered further by a new ban on European governments extending short-term trade guarantees, and by tougher restrictions on dealings with the Iranian central bank.
Other new measures include a ban on importing Iranian gas to Europe or providing any financing or transport of gas sales, as well as a prohibition on exporting graphite - used in steel-making - and metals to the Islamic Republic.
European companies will also be banned from providing storage or transport vessels for Iranian crude or petrochemical products, and from supporting Iranian ship-building.
At the core of Iran's dispute with world powers is its insistence that it has a right to enrich uranium and that economic sanctions should be lifted before it stops activities that could help it to achieve the capability to produce nuclear weapons.
The United States and European allies say Iran forfeited a right to enrich by concealing sensitive nuclear work from U.N. inspectors and stonewalling their long-running inquiry into suspected bomb research by Tehran.
They also believe that dropping sanctions first would remove any incentive for Iran to open up to inspectors and pursue a negotiated settlement.
Ashton last met Iran's chief negotiator Saeed Jalili in Istanbul in September for a session that her spokesman described as "useful and constructive".