Officials said the embargo was part of "an unprecedented set of sanctions." The United States has already approved a set of similar sanctions that have battered the Iranian economy.

The European Union officially agreed to impose an embargo on Iranian oil, today. The AP reports that the union's 27 foreign ministers agreed on an immediate ban on new contracts for oil and existing contracts will be allowed to run through July 1.

Bloomberg reports that the news drove the price of oil higher. If you remember, the EU has been crafting the ban for more than a month now. The United States has already set up similar sanctions in reaction to a United Nations report that found Iran had worked and might still be working on producing nuclear weapons.

The AP adds:

"British Foreign Secretary William Hague called the embargo part of 'an unprecedented set of sanctions.'

"'I think this shows the resolve of the European Union on this issue,' Hague said.

"The EU also agreed to freeze the assets of the Iranian central bank. Together, the two measures are intended not only to pressure Iran to agree to talks but also to choke of funding for its nuclear activities."

As we've reported, the biggest obstacle to the EU sanctions was Greece, which is struggling economically and gets most of its oil from Iran. Bloomberg reports the phased-in approach was designed to "limit the damage to Greece."

Iran has said that if the EU imposed a ban, it could find other buyers for its oil, but the sanctions have already taken their toll on the Iranian economy. As the AP reported yesterday, the rial has been on a roller coaster ride since the U.S. announced its sanctions. The currency lost as much as 13 percent of its value. [Copyright 2012 National Public Radio]