Washington DC - The US on Monday warned foreign financial institutions that if they conducted any business with Iran or its banking sector they will face severe sanctions from Washington.

"Foreign financial institutions continuing to transact with sanctioned Iranian financial institutions could be targeted at any time without advance notification and should take immediate action to terminate such activity and relationships," the US Treasury said in an "alert" statement released on Monday.

The US and Israel launched a war of aggression against Iran in late February, killing the country's leadership and demanding it cease any nuclear-related activities.

Since then, the war has plunged the Middle East into violence, Tehran's retaliatory action targeting Washington's Gulf allies and sending global energy and fertilizer prices skyrocketing by cutting off the strategic Strait of Hormuz.

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Since late August, Washington has stepped up its campaign to economically isolate Tehran, warning its allies they would be hit by secondary sanctions if they continued to conduct transactions with the country's government.

The US Treasury has also announced a slew of new sanctions as part of that push, targeting Iran's financial, cryptocurrency, rail, automotive, and manufacturing sectors.

It has also taken action against two banks – one in the United Arab Emirates and another in Turkey – over their alleged aid to the authorities in Tehran.

In Monday's statement, the Treasury said Iran's government operated so-called "shadow banking" channels to circumvent US sanctions, and that foreign financial institutions should aim to identify and avoid any such activities.