"Iran didn't fall into that trap", Iranian President Hassan Rouhani said in a televised address. Tehran also gave a 60-day deadline to the remaining parties of the agreement, saying that it would resume higher uranium enrichment if they failed to start delivering on their commitments to sanctions relief.
Iranian Foreign Minister Mohammed Javad Zarif separately will write to the European Union, the agency said.
Tensions have risen on the eve of the anniversary of President Donald Trump's withdrawal from the agreement, under which Iran agreed to curbs on its nuclear programme in return for the lifting of worldwide sanctions.
Speaking in a joint press conference with Lavrov, Zarif insisted that Iran's latest decision did not violate the agreement and asserted it was provoked by USA actions toward Iran. However if the other countries work with Iran, Rouhani said his government will resume complying.
Iran's president says increased uranium enrichment will begin in 60 days if world powers don't shield it from US sanctions, under the terms of the 2015 nuclear agreement.
The Trump administration has restored USA sanctions and extended them, effectively ordering countries around the world to stop buying Iranian oil or face sanctions of their own.
"If Iran does resume construction on [nuclear] facilities and formally breach the deal, don't expect Europe to play nice and let that happen, especially the French", said Brian O'Toole, a former Treasury Department official who worked on US sanctions and is now a nonresident senior fellow at the Atlantic Council, a think tank. It suggested in its Tuesday edition that Iran may install advanced centrifuges at its Natanz facility and begin enrichment at its Fordo facility, activities prohibited under the nuclear deal. A waiver also enabled Iran to ship excess heavy water to Oman for storage, from where it could be sold to foreign customers. But the USA sanctions have greatly reduced the production of Iranian crude oil since last May, and halved the oil exports to below 1 million bpd over the past year, according to reports.
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As The Washington Post noted, "Uranium used as fuel in power plants needs to be enriched only to a low level". Jettisoning limits on the amount of uranium it can stockpile-and, importantly, how much it can enrich that uranium-would set Tehran back on the path to developing a viable nuclear weapon. However, once a country enriches uranium to around 20pc, scientists say the time needed to reach 90pc is halved.
As Iran's move on Wednesday was anticipated to further destabilize the economy, Iran's Central Bank Governor Abdolnasser Hemmati says the bank has taken some preparatory measures.
"We felt that the nuclear deal needs a surgery, and the painkiller pills of the a year ago have been ineffective", Mr. Rouhani said. "We as Europeans, as Germans, will play our part and we expect full implementation from Iran as well", Chancellor Angela Merkel's spokesman Steffen Seibert said.
"On the way here, I heard that Iran intends to continue its nuclear program", Netanyahu said at a Memorial Day event in Jerusalem. The three European parties to the deal - Britain, France and Germany - tried to save the accord with a trade mechanism meant to bypass reimposed United States sanctions, but their attempt was dismissed by Iran's supreme leader Ayatollah Ali Khamenei as a "bitter joke".
Tehran said it would abandon more if the remaining parties to the agreement - Britain, China, France, Germany and Russian Federation - failed to start delivering on their commitments to sanctions relief within 60 days.