French President Emmanuel Macron spoke with U.S. President Donald Trump by phone on Saturday and expressed his "great concern about the stability" of the Middle East in the wake of Trump's decision to withdraw from the 2015 Iran nuclear accord.
Macron's office said the French leader expressed his worries to Trump, whom he considers a friend.
Macron strongly opposes Trump's withdrawal from the agreement, which aimed to curb Iran's nuclear activities in return for the lifting of sanctions, which the U.S. is now reimposing. Hostilities between Iran and Israel have also escalated dramatically in recent days.
Macron and Trump also discussed trade issues.
European governments are scrambling to save billions of dollars in trade that began with Iran following the 2015 accord but has now been halted or placed in doubt.
In addition, France and the EU are pressing Washington for exemptions from Trump's recently introduced steel and aluminum tariffs.
Meanwhile, German Chancellor Angela Merkel said Saturday that Trump's decision was making the already tense situation in the Middle East "even more difficult," and warned Europeans to be skeptical of "easy" solutions promised by populists.
Speaking in Italy, Merkel said the escalation of Israeli-Iranian hostility since Trump's announcement is a reason for concern.
Germany is closely monitoring the developments between Iran and Israel, which offer "yet another reason for further effort to resolve the conflict," she said.
Merkel was speaking at St. Francis' Basilica in Assisi, she was awarded the St. Francis Lamp of Peace for the welcome Germany gave to Syrian war refugees, a decision that carried political risks for her and her party.
"Sometimes it is not even about the people in Syria anymore," Merkel said.
"And that is why today's award is aimed at bringing me and other European leaders and countries closer to find a solution for this conflict. And with the U.S. pullout of the nuclear deal, the situation has become even more tense.
"We are following the events between Iran and Israel, and for the background of German history and the background that Israel security is a reason of state for Germany, we are urged to play a strong and committed role in resolving this conflict. But we are only going to be able to do that if we can develop the European Union. One country alone in Europe cannot act on it, and that is why we need to work together."
Speaking of conflicts on her own continent, Merkel decried the "nightly violations" in Ukraine of cease-fire agreements reached in 2014 and 2015 between Ukrainian independence forces and pro-Russia fighters in the country's battered east.
Delivering a sweeping speech about challenges to a more peaceful world, Merkel cautioned against Europeans seeking easy solutions to their problems from populist politicians, whose clout has been on the rise across much of the continent.
"The harder the problem is, and the easier the solution is claimed to be, the more suspicious and critical everyone .... should be," Merkel said.
Merkel has expressed her support for maintaining a big-power nuclear accord following the withdrawal of the United States as long as Iran upholds its side of the deal, and has called for talks to be held in a broader format on Iran's ballistic missile program and its regional activities, including in Syria and Yemen, her office said in a statement this week.
In France, Finance Minister Bruno Le Maire said on Friday that Europe should not accept the U.S. as the "world's economic policeman."
"Do we want to be vassals who obey decisions taken by the United States while clinging to the hem of their trousers? Or do we want to say we have our economic interests, we consider we will continue to do trade with Iran?" Le Maire asked, speaking on Europe-1 radio.
Iran has said it may resume uranium enrichment at a higher rate within weeks if it finds the nuclear deal is not working after the U.S. pullout.
Meanwhile, the Kremlin said that Russia and its allies from the Eurasian Economic Union – a grouping that includes Kazakhstan, Belarus, Armenia and Kyrgyzstan – will sign a free trade pact with Iran next week. The signing had been planned for long time, but it now coincides with the U.S. move to reimpose sanctions against Iran.
European Union foreign policy chief Federica Mogherini said it is not up to the U.S. to determine the future of the nuclear deal.
"This deal is not a bilateral treaty. It's a U.N. Security Council Resolution and it belongs to the entire world," she said.
Mogherini will chair talks with the British, French, German and Iranian foreign ministers in Brussels on Tuesday, and called for calm on all sides.
"It is exactly when the things don't go well that rationality, calm, predictability, respect, dialogue are the most needed to avoid the worst-case scenarios, to avoid conflict to spiral out of control," she said. "It seems that today screaming and shouting, insulting and bullying, systematically destroying and dismantling everything already in place is the mood of our times."
However, Europe's options are limited.
As a result of the new U.S. sanctions, companies worldwide must stop doing business with Iran or risk U.S. fines or other punishment. The sanctions will not only bar American companies from doing business with Iran, they will also harm European and other companies by prohibiting them from using American banks unless they cut links with Iran.
Plane-makers Airbus and Boeing, oil companies and auto manufacturers including France's Renault and Peugeot could be among companies hardest hit.
Le Maire, the French finance minister, said he had pushed U.S. Treasury Secretary Steven Mnuchin for three options: exemptions for French companies operating in Iran, or the application of a so-called grandfather clause for deals struck in Iran since 2015, or an extension of the 90-day period to wind down operations in Iran.
However, Le Maire acknowledged he has "no illusions" that he will get what he asked for.
Facing that reality, Le Maire said the EU should strengthen its own legal arsenal against any such future U.S. threats.
Among things the EU could considerare reinforcing a 1996 "blocking statute" that could allow companies to ignore sanctions, he said. Another could be an independent financing mechanism allowing European companies to avoid U.S. banks.
Le Maire also proposed creating a European body that would have the same kind of powers as the U.S. Justice Department to punish foreign companies for their trade practices.
Meanwhile, the U.S. government tried to further pinch Iran's finances by disrupting a currency exchange network allegedly used to transfer millions of dollars to Iran's Revolutionary Guard Corps.
