The president, in a joint appearance Monday at the White House with Israeli Prime Minister Binyamin Netanyahu, said both he and the prime minister agree "that it is imperative that Iran not possess a nuclear weapon."
The meeting between the U.S. and Israeli leaders comes just three days after Obama held a 15-minute phone conversation with new Iranian President Hassan Rouhani -- the first conversation between U.S. and Iranian leaders since 1979
Netanyahu urged the president Monday to keep sanctions against Iran in place despite the recent thaw in relations. He said Iran's conciliatory words have to be matched "by real actions -- transparent, verifiable, meaningful actions."
"Iran is committed to Israel's destruction," Netanyahu said. "So for Israel, the ultimate test of a future agreement with Iran is whether or not Iran dismantles its military nuclear program."
"The bottom line," he said "is that Iran fully dismantles its military nuclear program."
Obama said the sanctions have been effective in moving Iran towards negotiations.
"Because of the extraordinary sanctions that we have been able to put in place over the last several years, the Iranians are now prepared, it appears, to negotiate," Obama said. "We have to test diplomacy. We have to see if, in fact, they are serious about their willingness to abide by international norms and international law and international requirements and resolutions."
The president said negotiations with Iran will be held "in good faith ... indicating that it is our preference to resolve these issues diplomatically," he said.
"But we enter into these negotiations very clear-eyed. They will not be easy. And anything that we do will require the highest standards of verification in order for us to provide the sort of sanctions relief that I think they are looking for."
Netanyahu said not only should the pressure of the sanctions be kept in place, but they should be strengthened if there is any sign Iran is continuing to advance its nuclear program during negotiations.
"It's the combination, I believe, that has guided your policy and our policy so far, that is good credible military threat and strong sanctions I think is still the only formula that can get a peaceful resolution of this problem," he said.