Iran faced growing economic pressure on Monday after two Western oil firms halted business with it, and the UAE, seen as a trade lifeline for Tehran, moved to freeze some Iranian-linked bank accounts.   

The developments underlined the major oil producer's increasing international isolation over a nuclear programme it says is aimed at generating electricity but major powers suspect is intended for making bombs.

France's Total joined an expanding list of companies that have stopped gasoline sales to Iran, and Spain's Repsol said it had pulled out of a contract to develop part of the country's huge South Pars gas field in the Gulf.

"Total has suspended its sales of gasoline or refined products to Iran," a company spokesman said in Paris.

The decisions were announced four days after the US Congress approved a bill to penalise firms supplying gasoline to the Iran, which is the world's fifth-largest oil exporter but lacks sufficient refining capacity for its own fuel needs.

The director of the US Central Intelligence Agency, Leon Panetta, speaking in Washington on Sunday, said targeted economic sanctions would probably not deter the Islamic Republic from seeking a nuclear capability.   

Panetta also asserted that Tehran had enough nuclear material for two bombs if further enriched.   

Iran's hardline president, Mahmoud Ahmadinejad, dismissed the latest punitive measures, declaring that his country could become self-sufficient in gasoline production "within one week, there is no problem".

He told a Tehran news conference that Iran was prepared to resume nuclear talks with major powers but only after a delay of several weeks to "punish" the West for imposing new sanctions, and with friendly countries included at the table.

"Are they so afraid of two bombs? There are 20,000 bombs stockpiled and they are so afraid of the possibility of the existence of two bombs? This is really amazing," he said.

The UN Security Council has imposed four rounds of sanctions since 2006 over Iran's refusal to halt sensitive uranium enrichment.   

Moving to implement the latest round of measures, the UAE's central bank told financial institutions to freeze any accounts belonging to dozens of Iran-linked firms targeted by the June 9 UN resolution, a banking source said.

Last week an Emirati newspaper reported that the United Arab Emirates was "tightening the noose" on companies the Security Council suspects act as fronts for supplies to Iran's atomic activities.

Iran and the UAE have close economic and historic relations and tens of thousands of Iranians live and work in trade hub Dubai and elsewhere in the Arab state, many of them involved in the multi-billion-dollar, re-export trade to Iran.

But Dubai's ties with Tehran have drawn scrutiny from the United States, which is spearheading a drive to pressure Iran into halting nuclear enrichment, which can have both military and civilian uses.   

Iran has long circumvented restrictions on goods blacklisted by sanctions and much of the trade goes via the UAE, said Middle East analyst Gala Riani of IHS Global Insight.   

"The UAE, and Dubai especially, has come under a lot of pressure... to tighten restrictions and controls on Iranian firms," Riani said. They are now "signalling that they are playing ball with the international community", she said.   

The latest UN resolution calls for measures against new Iranian banks abroad if a connection to the nuclear or missile programmes is suspected, as well as vigilance over transactions with any Iranian bank, including the central bank.

Going beyond the UN sanctions, the US Congress last week approved new unilateral measures to squeeze Iran's energy and banking sectors. The European Union has also decided to implement additional measures.

Royal Dutch Shell, BP, Reliance Industries and independent Swiss trader Glencore are among suppliers that have already either stopped fuel sales to Iran or decided not to enter into new trading agreements with it.- Reuters