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BRUSSELS, BELGIUM - Europe banned the import of Iranian oil Monday and froze Europe-based assets of the Central Bank of Iran, intensifying an international campaign to choke Iran's economy and force the radical Islamic government to dispel fears that it is working to develop nuclear weapons.

The ban, decided by foreign ministers of the 27-nation European Union, is a dramatic escalation of sanctions against Iran, joining with the United States to squeeze the oil earnings and financial transactions that the Tehran government depends on to sustain its citizens and finance its military. British Foreign Secretary William Hague called the E.U. effort "unprecedented" and said it shows the resolve of European governments to prevent Iran from becoming a nuclear power.

Iran, however, has the benefit of its contracts with Asian nations -- in particular, about 60 percent of Iran's 2.2 million barrels a day of exports have been locked into contracts with China, Japan and South Korea. Turkey accounts for an additional 7 percent. Traditionally, European customers have accounted for less than 20 percent of Iranian exports.

Nevertheless, powerful figures in Iran immediately threatened retaliation, according to news agency reports from Tehran. Their defiance, including calls to close the Strait of Hormuz, underlined the high stakes in the West's confrontation with the Islamic government.

Ali Fallahian, a member of the country's influential Assembly of Experts and a former intelligence minister, told the semiofficial Fars News Agency that Iran should cut off sales to European nations immediately and, if the crisis grows, constrain maritime traffic through the strait. The Strait of Hormuz is a narrow exit from the Persian Gulf through which one-fifth of the world's oil exports pass.

Similarly, Mohammed Kossari, deputy chief of the parliament's foreign affairs and national security committee, said if any disruption occurs, the Strait of Hormuz will be closed.

Iran had threatened earlier to close the strait, and the Obama administration has said that the United States would see the action as a red line that it would not allow Iran to cross. Underlining the point, a U.S. aircraft carrier group led by the USS Abraham Lincoln sailed through the strait Sunday into the Persian Gulf, accompanied by two European frigates, the British Navy's Argyll and the French Navy's La Motte-Picquet.

European ministers emphasized that their goal in imposing the sanctions was not to provoke more confrontation with Iran, but rather to push the nation to resume talks on Iran's nuclear program and to increase openness for inspectors from the International Atomic Energy Agency.

Iran has consistently maintained that its nuclear development program is designed to further research and supply electricity. But it has refused full access to its facilities, which include a new underground uranium-enrichment plant.

In a joint statement, U.S. Secretary of State Hillary Rodham Clinton and Treasury Secretary Timothy Geithner called the E.U. move a "strong step." But they reiterated that the United States and other powers are looking for Iran "to engage seriously in discussions with the international community on its nuclear program."

McClatchy News Service contributed to this report.