Iran has amassed sufficient reserves to withstand a total embargo of all oil exports for "two to three years", President Mahmoud Ahmadinejad claimed on Tuesday.

Negotiations between Iran and the leading western powers, plus Russia and China, are due to take place in Istanbul on Saturday.

On the eve of these talks – the first for over a year – Mr Ahmadinejad gave a defiant speech claiming that the central measure taken to increase the pressure on Iran´s economy would have no effect.

The European Union has agreed to stop buying oil from Iran by July 1 – and the state media in Tehran reported that the country had chosen to pre-empt this measure by halting exports to Greece, one of its biggest EU customers.

"They want to impose sanctions on our oil and we must say to them that we have that much saved that even if we didn´t sell oil for two to three years, the country would manage easily," said Mr Ahmadinejad in a televised speech.

"Whoever seeks to violate the rights of the Iranian nation will get a blow to the mouth," he added.

Last year, the EU imported almost 600,000 barrels of Iranian oil every day, accounting for 24 per cent of the country´s total exports, according to the International Energy Agency. The loss of these sales is expected to deal a significant blow to the central pillar of the national economy.

Iran will probably find alternative customers for this oil, but they are likely to drive a hard bargain and insist on low prices, costing the country billions of dollars in lost revenue.

Last year, Iran is believed to have made about $80 billion from oil sales, accounting for half of its entire national budget and about 80 per cent of its export earnings.

Mr Ahmadinejad has a long history of exaggerated claims for the prowess of the Iranian economy. But western governments judge this to be his Achilles´ heel.

Iran´s economy has stagnated for years, with the value of the national currency, the Rial, plunging in the early months of this year, creating widespread discontent with the regime. (© Copyright of Telegraph Media Group Limited 2012. 04/11/12)