House and Senate negotiators came to an agreement late Monday night to move ahead with new sanctions that will try to cripple Iran's financial strength and undercut its nuclear program, the Associated Press reported.

The sanctions expand penalties on financial institutions that work with Iran's central bank, while also hitting those who mine uranium with Iran and provide oil tankers to Iran, among other actions. Hitting Iran's oil income, U.S. officials say, could cost the country tens of millions of dollars, strangling its nuclear program.

"This bipartisan, bicameral Iran sanctions legislation strengthens current U.S. law by leaps and bounds," House Foreign Affairs Committee Chairwoman Ileana Ros-Lehtinen, R-Fla., told AP. "It updates and expands U.S. sanctions, and counters Iran's efforts to evade them. The bill sends a clear message to the Iranian regime that the U.S. is committed, through the use of sanctions, to preventing Iran from crossing the nuclear threshold."

Defense Secretary Leon Panetta is starting talks with Israel on Tuesday, discussing ways to reach a diplomatic solution with Iran. Panetta cautioned, however, against extreme hawkish rhetoric when dealing with Iran, as it could spur a military conflict, The Wall Street Journal reported. Although "the results of [the sanctions] may not be obvious at the moment," the sanctions are having a "serious impact" on Iran, he said.

"The fact is that they've expressed a willingness to try to negotiate," Panetta said in Tunisia, according to the Journal. "And they continue to seem interested in trying to find a diplomatic solution."

Lawmakers hope to vote on the legislation next week, before the August recess.

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