Iran's Supreme Leader, Ayatollah Khamenei, said he had ordered preparations for enrichment, should the 2015 nuclear deal fail completely.
Iran will inform the United Nations nuclear watchdog agency that preparations will begin on Tuesday, Behrouz Kamalvandi, spokesman for Iran's Atomic Energy Organization, was reported saying by state media.
In May, US President Donald Trump pulled the US from the landmark 2015 nuclear deal between Iran and the world powers.
As European states and China reiterated their commitment to the nuclear deal, Iran's foreign ministry stated that in spite of Washington's move, Tehran would abide by its obligations under the deal, calling on the worldwide community to stand up against "US law-breaking behavior, bullying and disregard for the rule of law".
Katz believes that the current situation leaves Tehran with two options: Either to accept the 12 conditions outlined by US Secretary of State Mike Pompeo for the resumption of talks regarding the nuclear deal or "start a process of an economic collapse, and maybe even a regime, collapse".
Iran denies the pursuit of an atomic programme for military purposes.
"If Iran does not get the financial guarantees in oil and access to the financial system, then I don't see Iran sticking to the deal because the pressure from (Iranian) hardliners is only increasing", said a Western official.
Hoping to protect their interests, the Europeans have proposed hammering out a supplementary deal with Tehran covering its ballistic missile program as well as its interventions in countries such as Lebanon, Syria, Iraq and Yemen. Although the remaining signatories-the U.K., Germany, France, Russia, China and the European Union-say they are committed to the agreement, the threat of new American sanctions could scupper it.
The 2015 deal limited Iran to enriching uranium only to 3.67%, far below the roughly 90% threshold of weapons-grade material.
The EU has been trying to save the nuclear deal, after the U.S. withdrawal startled the bloc.
The nuclear deal and lifting of punishing nuclear related global sanctions created optimism in Iran after years of economic isolation.
Iranian Foreign Minister Javad Zarif began a diplomatic tour last month in an effort to persuade the deal's other signatories to keep to it.
In return, Iran received relief from sanctions, most of which were dropped in January 2016.
Earlier, Netanyahu said the Iranian plan to increase its nuclear enrichment capacity was aimed at producing nuclear weapons to be used against Israel, its archrival.
As EU businesses face retaliation from the United States for doing business with Iran, many are opting to avoid Iran.
"We support Israel's right to security and have said this to Iran at all times", she said.