US President Barack Obama Tuesday announced new sanctions against foreign banks that help Iran sell its oil.

Obama said the latest round of sanctions is to "deter Iran from establishing payment mechanisms for the purchase of Iranian oil to circumvent existing sanctions".

China's Bank of Kunlun and Iraq's Elaf Islamic Bank have been targeted for "knowingly" enabling financial transactions for blacklisted Iranian banks, Xinhua reported.

They "facilitated transactions worth millions of dollars on behalf of Iranian banks that are subject to sanctions for their links to Iran's illicit proliferation activities." 

Foreign financial institutions, whose governments still purchase Iranian crude oil as of June 28 this year, will be denied access to the US financial market, as per US law.

Twenty countries, including Japan, India, Malaysia, South Korea and China, have got US waiver due to their governments' reduced purchases of Iranian oil.