The US has told its allies to cut all oil purchases from Iran to zero by November as it prepares to reinstate sanctions against the country.
The State Department said it does not plan to offer waivers or allow countries to wind down imports from Iran.
Oil prices jumped following the announcement.
The US has said firms that continue to do business with Iran risk punishment once sanctions are reintroduced.
The Trump administration said in May that it would withdraw from the 2015 nuclear pact with Iran signed by former US President Barack Obama.
The agreement lifted sanctions on Iran but the US now plans to re-impose those measures.
However, the request that countries cut their purchases to "zero" by 4 November without exception came as a surprise.
US crude oil prices shot above $70 (£53) for the first time since May, rising by 3.91% to $70.74 a barrel.
The price of Brent also rose, up 2.61% to $76.68 a barrel.
Iran is one of the world's largest oil producers, with exports worth billions of dollars each year.
In prior comments, the US had indicated it would consider waivers to the sanctions if countries could show progress toward reducing purchases.
However, a State Department official said on Tuesday that the sanctions were one of the administration's "top national security priorities".
"The predisposition would be no, we're not granting waivers", the official said.
Though he also said: "I would be hesitant to say zero waivers ever."
The US plans to ask other oil producers in the Middle East to help keep supplies steady, the official added.
Iran is already feeling economic pressures after protests erupted this week amid concerns about rising prices and a decline in the value of its currency, the rial.
The country's average daily oil exports have fallen this month compared to May.
Several companies, including French oil giant Total, have already said they will wind down business in Iran if they do not receive waivers.
But the State Department said the US has not yet discussed the issue with China and India, the two biggest buyers of Iranian oil.
Last month, the EU said it would revive legislation to allow European companies to continue doing business with Iran, despite US rules.
France and others have criticised the US for withdrawing from the 2015 agreement, which was also signed by the UK, France, Russia, Germany and China.