The US and EU are preparing fresh sanctions on Iran’s missile and drone programme in response to the Islamic republic’s attack on Israel, but the UK and European governments are resisting pressure to designate the elite Revolutionary Guards a terrorist organization, writes The Financial Times.

Janet Yellen, US treasury secretary, on Tuesday said the administration was poised to take “additional sanctions action against Iran in the coming days”. The US would work with allies over measures to disrupt “the Iranian regime’s malign and destabilising activity”, Yellen said, while adding there may be “more to do” on Tehran’s oil trade.

A growing majority of EU capitals support the new sanctions, which would target the Iranian networks that supply Iran-backed militant groups across the region, according to four people briefed on the matter.

But some European officials are wary of further escalating tensions with moves that target the so-called axis of resistance — which includes Hizbollah in Lebanon, Hamas in Gaza, Houthi rebels in Yemen and Iraqi militias — during such a volatile period in the Middle East.

Annalena Baerbock, German foreign minister, said the EU had already imposed sanctions on Iranian military supplies used by Russia in its war against Ukraine: “Late last year Germany, France and other EU partners pushed to broaden the scope of the sanctions to other types of missiles in Iran’s arsenal, in view of the way Iran and its proxies are destabilising the Middle East. This was now likely to happen. I hope that we as the EU can now finally take this step together”.

In addition to blacklisting Iran’s missile and drone programmes, the US will also target entities supporting the IRGC and Iran’s defence ministry, US national security adviser Jake Sullivan said: “These new sanctions and other measures will continue a steady drumbeat of pressure to contain and degrade Iran’s military capacity and effectiveness, confront the full range of its problematic behaviours”.