EU diplomat: no details on Iran sanctions until July

The contact added that: "Working out the list itself is clearly a pretty controversial business given the sort of differing interests among EU member states ...The details of those measures are due to be worked out over the period of the next month with a view to their formal adoption at the July foreign ministers' council on the 26th."

Draft EU summit conclusions circulated to reporters on Wednesday leave a blank space under the "Iran" rubric.

But the 27 EU foreign ministers on Monday agreed a text set to be rubber stamped by the heads of state and government, saying that "new restrictive measures have become inevitable" due to Iran's intransigence on nuclear enrichment.

The foreign ministers' text says the EU will broadly target: "key sectors of the gas and oil industry ...dual use goods and further restrictions on trade insurance ...the financial sector, including [a] freeze of additional Iran banks ...the transport sector as regards the Republic of Iran Shipping Line and its subsidiaries and air cargo."

The measures could also see the EU freeze any European-based bank accounts of the Revolutionary Guard Corps, the security-industrial complex at the heart of the Iranian regime.

They are likely to hurt European companies keen to invest in Iran's oil and gas sector and could damage prospects of pulling Iran into the EU's Nabucco pipeline project, aimed at bringing Caspian Sea basin gas into the union.

Germany is Iran's largest EU trade partner, with exports worth €3.7 billion last year. But the country's foreign minister, Guido Westerwelle, gave the green light to the new measures on Monday in response to French entreaties, UK daily The Guardian reported.

Sweden, which also fields companies involved in Iran's oil and gas sector, was the strongest opponent of the initiative. Cyprus, Greece and Malta, whose ports stand to lose income from Iranian shipping lines, could also prove difficult in the upcoming discussions on sanction details.

The UN last week, including Iran ally Russia and non-interventionist China, gave the green light to fresh anti-Iran measures, despite Turkish and Brazilian opposition.

Israel has also been pressing the EU to toughen its stance against Iran's suspected nuclear weapons programme. But EU-Israel relations have come under strain following its bloody commando raid on an aid flotilla to Gaza in May.

The EU foreign ministers on Monday urged Israel to reopen access to the Hamas-controlled strip under an EU monitoring "mechanism." EU foreign relations chief Catherine Ashton speaking to MEPs in Strasbourg on Wednesday continued to pile on the pressure.

"Living next to one of the most modern countries in the world, people [in Gaza] carry goods by horse and cart. Israel rightly boasts an excellent education system and world-class universities. Next door, many children are denied basic schooling. The blockade denies Gaza the bricks and cement which the UN needs to build new schools, hospitals, housing and sanitation," she said.

EU leaders are unlikley to tackle the issue of the Gaza blockade on Thursday, however.

"In the background as well, there is the situation in Gaza. But it's not formally on the agenda. And I don't think there is any expectation at the moment that that will arise," the EU diplomatic source said.