Donald Trump threatened Iran with “obliteration” after the country’s president questioned his mental health for imposing sanctions against the Islamic Republic’s supreme leader.
The exchange of insults came as Britain ruled itself out of a potential war between the two sides.
Jeremy Hunt, the foreign secretary, told the Commons on Tuesday: "The US is our closest ally, we talk to them the whole time, we consider any requests that they say carefully, but I cannot envisage any situation where they request or we agree to any moves to go to war.
"The message we are sending with our partners in the European Union particularly the French and the Germans is that with respect to Iran's nuclear programme, this is a crucial week.”
Mr Trump signed an executive order imposing financial sanctions on Ayatollah Ali Khamenei, Iran's head of state, and several senior military commanders on Monday in retaliation for the downing of a US surveillance drone last week.
US officials said they expected to sanction Javad Zarif, the foreign minister, in the near future. Mike Pompeo, the US Secretary of State, simultaneously said the US was ready for talks with Iran without pre-conditions.
Hassan Rouhani, the president of Iran, said in a televised address on Tuesday that the mixed messages showed the White House had “lost its mind.”
"You sanction the foreign minister simultaneously with a request for talks," he said in a televised address. "The White House is afflicted by mental disability and does not know what to do."
There was debate about whether the Persian word used by Mr Rouhani was better rendered as "retardation".
An Iranian foreign ministry spokesman said separately that the sanctions against Ayatollah Khamenei, Iran’s head of state, breached international practice and meant “closing the door to diplomacy.”
In an apparent response to Mr Rouhani, Mr Trump tweeted on Tuesday afternoon: “Iran leadership doesn’t understand the words “nice” or “compassion,” they never have.”
He went on: “Iran’s very ignorant and insulting statement, put out today, only shows that they do not understand reality. Any attack by Iran on anything American will be met with great and overwhelming force. In some areas, overwhelming will mean obliteration. No more John Kerry & Obama!”
The sanctions were the latest measure in a campaign of “maximum pressure” that US officials say is designed to force Iran to accept re-writing the 2015 nuclear deal with more restrictive terms.
Mr Trump pulled the United States out of the deal, which offered Iran sanctions relief in exchange for restrictions on its nuclear program, in May 2018.
Iran's economy has been hit hard by renewed US sanctions, but it has ruled out revisiting the 2015 agreement.
Iran has said it expects its low enriched uranium stocks to exceed the limit set by a 2015 nuclear deal by Friday because the US is no longer buying the excess.
It has also said it will incrementally relinquish other commitments under deal from July 7 unless the EU, Britain, France, and Germany - the European signatories to the agreement - find a way to allow it to sell oil and access the revenues.
Over the past two months tensions have led to military confrontation, with the US and its allies blaming Iran for mysterious attacks on oil tankers near the Strait of Hormuz, mortar attacks on US facilities in Iraq, and missile strikes against Saudi Arabia by Yemeni Houthi rebels.
Last week Mr Trump said he ordered but then cancelled military strikes on Iran after it shot down a US surveillance drone last.