Iranian officials usually play down the impact of US and European restrictions on their oil industry, with Iran's oil minister saying on Saturday production would hold steady this year despite an EU ban on Iranian oil imports and shipping insurance since July.

But Mohammad Reza Bahonar, deputy-speaker of Iran's parliament, said on Sunday that the country's oil sales had dropped sharply as a result of sanctions designed to pressure Iran to give up its disputed nuclear programme.

"In the month of Tir (June 21-July 21) oil sales were about 800,000 barrels (per day)," Bahonar, who is also general secretary of Iran's Islamic Society of Engineers, was quoted as saying by the student news agency ISNA.

He said that oil sales averaged about 1 million bpd from the end of March to late August, compared to exports of 2.3-2.4 million bpd last year.

Daily Iranian oil exports of just 800,000 bpd for July are lower than International Energy Agency estimates of 1 million bpd.

Bahonar said the Iranian economy was suffering as sanctions on its banking and oil sectors reduce sales and make it difficult to repatriate earnings from any crude oil that it does manage to sell.

"We face two problems; first is that our oil sales do not proceed normally and second that the money that we do earn we cannot use easily," ISNA quoted him as saying.

Bahonar said exports may have bounced back to about 1.5 million bpd in the Persian calendar month of Aug. 22 to Sept. 22, after Iran solved some of its shipping problems.

But getting the money back to Iran for those sales continues to be a major headache for the government. "The pressure of moving money around and the banking system remains," he said.

US and EU sanctions are designed to slash oil revenues to starve Tehran of funds that might be channelled to expensive nuclear weapons programmes.

Iran denies that it is seeking nuclear weapons, saying its atomic program is solely for peaceful purposes.