(Updates with detail; adds bylines)
By Tom Doggett and Susan Cornwell
WASHINGTON Jan 28 The U.S. Senate on Thursday approved legislation that would let President Barack Obama impose sanctions on Iran's gasoline suppliers and penalize some of Tehran's elites, a move aimed at pressuring Tehran to give up its nuclear program.
The sanctions, approved on a voice vote, would target companies that export gasoline to Iran or help expand the country's oil-refining capacity by, in part, denying them loans and other assistance from U.S. financial institutions.
The House of Representatives has already passed similar legislation. Differences between the two bills will have to be worked out before the measure becomes law.
Lawmakers and the Obama administration fear Iran's uranium enrichment program will be used to develop weapons, while Tehran says it is for peaceful purposes such as generating electricity.
Many in Congress want to give Obama more tools to pressure Iran. Cutting off gasoline supplies would hurt Tehran's economy; while Iran has the world's third biggest oil reserves, it must import 40 percent of its gasoline to meet domestic demand because of a lack of refining capacity.
In his State of the Union address on Wednesday, Obama warned Tehran faced "growing consequences" over its nuclear program. The administration has been working with several other major powers to build a consensus on new sanctions to be imposed jointly.
But U.S. business groups have warned the White House that the lawmakers' approach threatens to undercut this joint strategy. The critics say broad-based sanctions sought by lawmakers would upset U.S. allies whose companies would be affected, and frustrate joint action with other countries against Iran.
The sanctions in the Senate bill would extend to companies that build oil and gas pipelines in Iran and provide tankers to move Iran's petroleum.
The measure also prohibits the U.S. government from purchasing goods from foreign companies that do business in Iran's energy sector.
The Senate acted on the same day that Iran hanged two men convicted in the wake of political unrest in the country. "The situation in Iran is terrible and it's worsening. People are dying in Iran as we speak," said Senator John McCain just before the Senate vote.
Other provisions in the bill would:
* Impose a broad ban on direct imports from Iran to the United States and exports from the United States to Iran, exempting food and medicines;
* Require the Obama administration to freeze the assets of Iranians, including Iran's Revolutionary Guard Corps, who are active in weapons proliferation or terrorism;
* Allow state and local governments and private asset fund managers to easily divest from energy firms doing business with Iran;
* Strengthen export controls to stop the illegal black market export of sensitive technology to Iran through other countries and impose tough new licensing requirements on those who refuse to cooperate. (Editing by Eric Walsh)
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