BRUSSELS - The European Union provisionally approved substantial new economic sanctions against Iran over its nuclear program on Friday, with senior diplomats giving their backing to measures against Tehran's banking sector and industry.

The new sanctions will have to be formally approved on Monday at an EU foreign ministers' meeting in Luxembourg before coming to effect.

An EU diplomat, speaking on condition of anonymity, said the new measures include a ban on financial transactions, with some exceptions for those involving humanitarian aid, food and medicine purchases. Some other types of trade may also be allowed.

EU states will also be banned from extending short-term guarantees for trade with Iran, importing natural gas from Iran and selling metals and graphites to Iran.

"Coreper (a committee of EU ambassadors) agreed the sanctions package on (the) Iranian nuclear program," said the diplomat in a message to Reuters.

The trade and finance measures mark a major step-up of European pressure on Tehran, amid growing concerns over its nuclear program, foundering diplomacy and threats of attack on Iranian atom installations by Israel.
Iran denies its atom work has any military intentions and says it wants nuclear power for electricity supplies and medical needs.

The EU is also targeting Iran's shipping industry, in an effort to curb Tehran's ability to sell oil to obtain funds and hard currency. It banned imports of Iranian oil earlier this year.

New measures will ban European companies from providing shipbuilding technology and oil storage capabilities, as well as flagging and classification services to Iranian tankers.

More sanctions are also being prepared in the United States. (Reuters)