Iran will face further sanctions in response to its expected breach of a uranium enrichment cap, US Secretary of State Mike Pompeo has said.

"Iran's latest expansion of its nuclear program will lead to further isolation and sanctions," the top US diplomat said on Twitter.

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Iran said earlier it was hours away from breaching the cap set by an endangered nuclear deal reached with international powers but from which the United States withdrew last year.

The country also threatened to abandon more commitments unless a solution is found with parties to the landmark 2015 agreement.

The UK has said Iran had "broken the terms" of the accord and, along with Germany, urged Tehran to halt its advance towards breaching the cap.

Iranian Foreign Minister Mohammad Javad Zarif said that Tehran could further scale back its commitments, but "all such steps are reversible" if European countries deliver on their part.

The move to start enriching uranium above the agreed maximum purification level of 3.67% comes despite opposition from the European Union and the United States, which has quit the deal.

Iranian president Hassan Rouhani's order to exceed the threshold would be implemented "in a few hours" after the last technical details were sorted, Iran's Atomic Energy Organisation spokesman Behrouz Kamalvandi said live on state television.

Mr Rouhani initially flagged Tehran's intentions on 8 May, exactly one year on from US President Donald Trump abandoning the multilateral deal.

The Iranian president said the move is in response to a failure by remaining parties to help Iran work around biting sanctions reimposed by the US.

The two countries have been locked in an escalating war of words with Washington blaming Iran for a series of attacks on tanker ships and Tehran shooting down an American surveillance drone, raising fears of a conflict that both sides have said they want to avoid.

Deputy Foreign Minister Abbas Araghchi has singled out Iran's declining oil sales and the effect of financial sanctions as the main issues that needed to be solved, or Tehran would further step back from its nuclear commitments.

"We hope we can reach a solution otherwise after 60 days we will take the third step as well," he said, adding that Tehran would give further details at an "opportune moment".

Iran has previously threatened to also resume building as of 7 July a heavy water reactor - capable of one day producing plutonium - in Arak in central Iran, a project that had been mothballed under the agreement.

However since Iran delivered its ultimatum on the Arak reactor "good technical progress" had been made with parties to the deal on modernising the reactor, convincing Iran to postpone its decision, Mr Araghchi said.

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The 2015 deal was reached between Iran and six world powers - Britain, China, France, Germany, the United States and Russia - and saw Tehran agree to drastically scale down its nuclear programme in exchange for sanctions relief.

Washington began reimposing sanctions in August 2018 and has targeted crucial sectors including oil exports and the banking system, fuelling a deep recession.

Mr Kamalvandi said that Iran's Atomic Energy Organisation was fully ready to enrich uranium "at any amount and at any level" if ordered to do so.

A top adviser to Iran's Supreme Leader Ayatollah Ali Khamenei hinted it could reach 5%.

The 3.67% enrichment limit set in the agreement is far below the more than 90% level required for a nuclear warhead.

Iran says that it is not violating the deal, citing terms of the agreement allowing one side to temporarily abandon some of commitments if it deems the other side is not respecting its part of the accord.

Britain and Germany have said they were coordinating with other partners to the deal.

In separate statements, their foreign ministries called on Iran to "stop and reverse all activities inconsistent with its commitments."

French President Emmanuel Macron told Mr Rouhani of his "strong concern" over the risk of weakening the nuclear agreement during a telephone call yesterday, according to a statement from the Elysee Palace.

However, Mr Macron pledged to "explore by 15 July the conditions for a resumption of dialogue between all parties".

Iran says it exercised "strategic patience" for a year after the US withdrawal, waiting for the remaining partners to make good on promised economic benefits.

Mr Trump has warned Iran that it is "playing with fire" by scrapping limits set by the accord.

Israeli Prime Minister Benjamin Netanyahu said today's announcement was a "very dangerous step" and called on France, Britain and Germany to impose "harsh sanctions" on Iran.

The International Atomic Energy Agency has scheduled a special meeting on Iran's nuclear programme for 10 July.