Donald Trump has signed an executive order imposing further sanctions on Iran, as tensions between the US and the Middle Eastern country have escalated following an attack on an American surveillance drone.

The order would deny Iranian supreme leader Ali Khamenei and others access to financial instruments, with Mr Trump declaring the measure necessary to deny Iran access to nuclear weapons, and in order to send a message after a downed spy drone nearly pulled the US into a war with the Iranian regime.

But it remained doubtful whether the restrictions imposed would have any significant impact on an opaque regime that largely operates outside of mainstream global business and financial channels controlled by the US.

“We will continue to increase pressure on Tehran,” Mr Trump said on Monday in the Oval Office. “Never can Iran have a nuclear weapon.”

In remarks to reporters, Mr Trump stressed his administration is not interested in a military conflict with Iran, even though the president reportedly called off an attack at the last minute last week in retaliation for the drone incident.

“We do not seek conflict with Iran or any other country,” Mr Trump said. “I can only tell you we cannot ever let Iran have a nuclear weapon.”

Tensions high as Trump approves new Iran sanctions: In pictures Show all 17 1 /17 Tensions high as Trump approves new Iran sanctions: In pictures Tensions high as Trump approves new Iran sanctions: In pictures Iran claims that in this picture released by Iran state TV, their surface-to-air missile is seen as it shoots down a US surveillance drone EPA Tensions high as Trump approves new Iran sanctions: In pictures This photo shows US RQ-4A Global Hawk unmanned surveillance drone. A drone of this model was shot down by Iran on Thursday 21 June AFP/Getty Tensions high as Trump approves new Iran sanctions: In pictures An oil tanker is on fire after it was subject to a suspected attacked at the Gulf of Oman on June 13. The US has blamed Iran for the attack Reuters Tensions high as Trump approves new Iran sanctions: In pictures Iran claims that in this picture released by Iran state TV, debris from the downed US drone is seen after it was recovered from Iranian waters AFP/Getty Tensions high as Trump approves new Iran sanctions: In pictures Smoke billows from an oil tanker after it was subject to a suspected attacked at the Gulf of Oman on June 13 Reuters Tensions high as Trump approves new Iran sanctions: In pictures US President Trump holds up a signed executive order to increase sanctions on Iran on 24 June AP Tensions high as Trump approves new Iran sanctions: In pictures Iranian President Rouhani stated in a televised address that the White House is "afflicted by mental retardation" following the increase in sanctions on 25 June EPA Tensions high as Trump approves new Iran sanctions: In pictures An Iranian navy boat tackles the fire on the Norwegian owned Front Altair oil tanker after it was hit in a suspected attack AFP/Getty Tensions high as Trump approves new Iran sanctions: In pictures Iran claims that in this picture released by Iran state TV, debris from the downed US drone is seen after it was recovered from Iranian waters AFP/Getty Tensions high as Trump approves new Iran sanctions: In pictures Smoke billows from an oil tanker after it was subject to a suspected attacked at the Gulf of Oman on June 13 Reuters Tensions high as Trump approves new Iran sanctions: In pictures A screenshot from a video released by the US Department of Defense that the US claims to show Iranian removing an unexploded limpet mine form the hull of the Japan-owned ship that was attacked in the Gulf of Oman on June 13 Getty Tensions high as Trump approves new Iran sanctions: In pictures An item reportedly found on the Japan-owned oil tanker that was attacked on June 13 in the Gulf of Oman AFP/Getty Tensions high as Trump approves new Iran sanctions: In pictures A handout photograph from the US Department of Defense shows a composite material that the US claim was left behind on the hull of the Japan-owned oil tanker following the removal of an unexploded limpet mine Getty Tensions high as Trump approves new Iran sanctions: In pictures A view from the cabin of an Iranian navy boat as it tackles the fire on the Norwegian owned Front Altair oil tanker after it was hit in a suspected attack EPA Tensions high as Trump approves new Iran sanctions: In pictures Release by US government A picture released by U.S. Central Command shows damage to the hull of the oil tanker Kokuka Courageous. The picture suggests that the ship is 'likely' to have been hit by a mine as the US Secretary of State Mike Pompeo moves to blame Iran for the suspected attack Reuters Tensions high as Trump approves new Iran sanctions: In pictures Smoke billows from an oil tanker after it was subject to a suspected attacked at the Gulf of Oman on June 13 Reuters Tensions high as Trump approves new Iran sanctions: In pictures Release by US government A picture released by U.S. Central Command shows damage to the hull of the oil tanker Kokuka Courageous. The pictures suggests that the ship is 'likely' to have been hit by a mine as the US Secretary of State Mike Pompeo moves to blame Iran for the suspected attack EPA

He suggested the military could have a role to play in the ongoing dispute, if deemed necessary. “I think a lot of restraint has been shown by us, but that doesn’t mean we’re going to show it in the future, but I felt that we want to give it a chance ... I think Iran has a phenomenal future,” he said.

In separate remarks, the US treasury secretary Steven Mnuchin said the sanctions target specific military leaders who the US believe are responsible for shooting down the US drone last week. Mr Mnuchin noted that Iranian foreign minister Mohammad Javad Zarif, alongside Mr Khamenei, is among those targeted, and that the sanctions target Iran’s “chain of command” in order to lock up billions worth of Iranian assets.

“Along with our existing sanctions ... we have additional sanctions to go after the supreme leader’s office and lock up literally billions of dollars worth of assets,” Mr Mnuchin said in the White House briefing room. “Along with that action today, we are also announcing specific sanctions targeting those responsible for recent activities.”

Support free-thinking journalism and attend Independent events

It remains unclear what, if any, impact on Iran the sanctions would have. The office of the supreme leader – a vast enterprise that includes thousands of employees – operates like a clandestine religious order, and rarely if ever taps into global financial institutions or networks. International officials from the UN and other nations who have dealings with Iran would be exempt from any sanctions.

Iran’s foreign ministry spokesperson Abbas Mousavi said last week that the US had run out of sanctions targets. “Is there any new sanction that Trump has not yet imposed against the Iranian nation?” he said in a 50-second video.

“He has imposed sanctions on individuals and companies and [has engaged in] economic terrorism and has started an economic war against us. Well, so far they have done everything they could,” Mr Mousavi quipped.

“These sanctions in reality... are propaganda and give them a sense of achievement,” he said. “I really do not know what kind of sanctions are left that they have not imposed so far. Let them impose new sanctions and we will see what happens.”