US national security adviser John Bolton continued the back and forth between the US and Iran on Tuesday stating it will be "the combination of sanctions and other pressure that does brings Iran to the table".
Trump signed an executive order on Monday imposing sanctions on Iran's supreme leader and other Iranian officials.
Iran's foreign ministry spokesman Abbas Mousavi tweeted on Tuesday that the sanctions would result in a "permanent closure of the path to diplomacy".
Bolton said that in the US president's view, "all options remain on the table".
"They should give up their pursuit of deliverable nuclear weapons," Bolton said about the Iranian regime. "They should make that strategic decision. They haven’t done it yet. All these subsidiary steps that they take simply make it more difficult for the rest of the world to trust them".
He said if Iran was serious about a solution, they wouldn't have violated the Nuclear Nonproliferation Treaty, be the "world's central banker" of terrorism or use combat in other sovereign countries.
On the president calling off a retaliatory strike against Iran, Bolton echoed earlier comments stating, "they should not mistake it as a sign of weakness".
Bolton was in Jerusalem for a trilateral meeting of national security advisers from Russia, Israel, and the United States to discuss issues in the Middle East.
Trump's son-in-law and senior adviser Jared Kushner is slated to release a "peace plan" for Israelis and Palestinians on Tuesday at a conference in Bahrain.
Bolton said that "threatening the conference in Bahrain is always a possibility," but that "it would be a big mistake for Iran to continue this kind of behaviour".
He also said it would be a mistake for Palestinians to boycott the first stage of the peace plan.
"I think we're optimistic, I think the president is optimistic and I hope the Palestinians are optimistic too," Bolton said.
Many Palestinian business leaders have said they would boycott the conference in Bahrain and Palestinians protested in Gaza ahead of the conference.
Bolton scoffed at a question of "regime change" in Iran and said the administration did not support that, stating that his comments as a private citizen did not reflect the policies of the administration and that he was not the decision-maker.
"The president sets the policies. I’m the national security adviser not the national security decision maker," he said.
Trump told NBC's "Meet the Press" on Sunday that Bolton was "absolutely a hawk".
"If it was up to him he'd take on the whole world at one time," Trump said.