EU sanctions on Iran's oil exports will hurt European refiners which rely on crude from the Islamic republic to help power ailing economies such as Greece, Italy and Spain, according to analysts.

The European Union is beefing up sanctions over Iran's nuclear programme by threatening to hit its oil and finance sectors.

Iran, the second-biggest OPEC player after kingpin Saudi Arabia, produces about 2.3 million barrels of oil per day -- 450,000 barrels of which is exported to the European Union, according to the US Department of Energy.

And according to OPEC estimates, Iran produces between 3.5-3.6 million barrels of oil per day.

Manouchehr Takin, an analyst at the Centre for Global Energy Studies (CGES) research group, said a removal of Iranian oil exports would hurt Europe more than Tehran.

"The Europeans are importing nearly half a million barrels per day ... Refineries in Greece, Italy and Spain are the main customers. They would suffer very much immediately financial loss (in event of sanctions) because they cannot easily replace that Iranian crude with other crude," he told AFP.

"Financially, I think these refineries in Europe -- especially those three countries that are having financial problems -- would lose and suffer more than Iran would lose in finding other customers," Takin added.

Commerzbank analyst Eugen Weinberg agreed that sanctions would most affect the three eurozone nations which are in the grip of severe debt problems.

"There is allegedly consensus in the EU about the need to impose an oil embargo on Iran," Weinberg wrote in a research note.

"It remains to be seen whether this step is actually taken, however.

"After all, crisis-ridden Italy, Spain and Greece rely on oil from Iran; an embargo would force them to source their oil requirements elsewhere at considerably higher prices."

On Wednesday, the head of OPEC said he hoped that the EU would not press for sanctions on Iran's precious oil exports.

"I really hope there will not be an EU embargo on Iranian oil," Secretary General Abdullah El-Badri told the World Petroleum Congress in Doha.

"It will be very, very difficult to replace" the Iranian exports.

"Europe now is facing some difficulties... so to cut these 865,000 barrels a day immediately, I think it will be a problem," he said, referring to the size of Iran's oil exports to all of Europe, not just EU members.

EU foreign ministers have slapped sanctions on an extra 143 firms and 37 individuals in Iran, after the publication last month of a report on the country's nuclear sector by the International Atomic Energy Agency (IAEA).

The ministers also threatened in a statement to "extend the scope" of punitive action to strike at Tehran's economic heart.

It said the EU would examine measures targeting the financial system, energy and transport by late January.

Takin added that, in the event of EU sanctions, Tehran could find customers elsewhere for its oil -- but in doing so may have to accept lower prices.

"Iran has about 2.3 million barrels per day in exports, and most of them are in Asia, the Far East and China -- and they will deal with them and sell more.

"Iran's bargaining position for its customers will be a bit weaker. If the Chinese and Indians know that the European refiners are not competing with them they will make the price go down, so Iran is not going to win either.

"But I think the financial loss would be more immediate and larger for the refiners in Europe," Takin said.

Traders meanwhile remain fearful that Tehran could try and block the strategically-sensitive Strait of Hormuz that links the Gulf with the Gulf of Oman -- and through which much of the region's oil is transported.

"Other than the ratcheting up of sanctions, which cripples the already struggling Iranian oil sector further, the key fear in the oil markets is the potential closure of the Strait of Hormuz, given that it is the sole waterway leading out of the Arabian Gulf," said Barclays Capital analyst Helima Croft.