Critics say White House U-turn on missile-test penalties hurts nuclear deal’s enforcement.

WASHINGTON—Leading lawmakers, including supporters of President Barack Obama’s nuclear deal with Iran, rapped the White House for delaying fresh sanctions on Tehran over its missile program, warning that the move would embolden it to further destabilize the Middle East.

The abrupt reversal by the administration came as Iranian President Hassan Rouhani publicly ordered his military to dramatically scale up the country’s missile program if the sanctions went ahead.

Senior U.S. officials have told lawmakers the sanctions were delayed because of evolving diplomatic work between the White House and the Iranian government.

Ben Rhodes, a deputy national security adviser to Mr. Obama, on Saturday said the U.S. government has more diplomatic and technical work to do before imposing new sanctions. Still, the U.S. wouldn’t negotiate the imposition of sanctions with Iran, he said. “They don’t get a say on who we impose sanctions on,” Mr. Rhodes told reporters in Hawaii, where Mr. Obama has been vacationing. “We just have additional work that needs to be done.”

The administration had notified Congress on Wednesday that it would impose new financial penalties on nearly a dozen companies and individuals for their alleged role in developing Iran’s ballistic missile program, but pulled back later that day.

Top U.S. lawmakers, including White House allies, said they believed failing to respond to Tehran’s two recent ballistic missile tests would diminish the West’s ability to enforce the nuclear agreement reached between global powers and Tehran in July.

“I believe in the power of vigorous enforcement that pushes back on Iran’s bad behavior,” Democratic Sen. Chris Coons of Delaware, a supporter of the nuclear deal, said Friday. “If we don’t do that, we invite Iran to cheat.”

Iranian state media reported American and Iranian diplomats undertook intensive deliberations in recent days to discuss the sanctions issue.

White House and State Department officials declined to comment on what was discussed with the Iranian side. U.S. officials said Secretary of State John Kerry has been in nearly constant contact with his Iranian counterpart, Javad Zarif, in recent days.

Iran’s most powerful political figure, Supreme Leader Ayatollah Ali Khamenei, has repeatedly warned that any new sanctions imposed by the U.S., including in relation to Tehran’s missile program, would violate the nuclear agreement.

Critics of the White House accused President Obama of backing down on his promises to take action in the face of Iranian provocations such as missile launches. They drew parallels to Mr. Obama’s failure to follow through on threats to launch military strikes on Syrian President Bashar al-Assad’s regime in 2013 in response to its alleged use of chemical weapons against civilians.

“I fear that pressure from our ‘partners’—or threats from the Iranian government that it will walk away from the deal or threaten the U.S. in other ways—have caused the administration to rethink imposing sanctions for Iran’s violations of the testing ban,” said Sen. Bob Corker (R., Tenn.), chairman of the Senate Foreign Relations Committee.

The sanctions would have been the first imposed on Iran since the nuclear agreement was reached in July. U.S. and European officials said that, if imposed, they would test whether Mr. Khamenei was serious about backing away from the deal.

Iran has test-fired two ballistic missiles since the July agreement, one in October and a second in November, according to U.S. officials. A United Nations panel ruled in December that the October launch violated a U.N. Security Council resolution that bans Iran’s development of ballistic-missile systems.

The White House on Wednesday morning sent a notification to Congress that the Treasury Department would announce at 10:30 a.m. new sanctions on the nearly dozen companies and individuals in Iran, Hong Kong and the United Arab Emirates.

The notification, according to a copy seen by The Wall Street Journal, quoted the Treasury’s top sanctions official, acting Undersecretary Adam Szubin, saying, “Iran’s ballistic missile program poses a significant threat to regional and global security.”

The White House then sent a second email to congressional offices at 11:12 a.m. stating the sanctions announcement had been “delayed for a few hours.”

In a final White House email sent just after 10 p.m., officials said the sanctions had been delayed, and didn’t specify when they might go ahead.

A senior administration official said Friday that the White House is considering the most appropriate response to Iran’s provocative actions, including the October ballistic-missile test, and will continue to discuss the matter with Congress.

Obama administration officials have said the U.S. could begin implementing the nuclear agreement in January, as Iran has taken steps to begin rolling back key parts of its nuclear program. As part of the deal, the U.S. committed to unfreezing as much as $100 billion in Iranian oil money frozen in overseas accounts.

U.S. and European officials, in private, have said they hope the sanctions relief could lend political support to Mr. Rouhani, whose allies are facing tough competition from conservatives in national elections in late February.

Some former U.S. officials said they believed the White House’s reluctance to impose the sanctions was driven by a fear of undermining Mr. Rouhani. Hard-line military and political leaders in Tehran have roundly criticized the terms of the nuclear agreement negotiated by the Iranian president and Mr. Zarif.

“Sanctions are construed in Iran by conservatives as evidence of a U.S. bait-and-switch, getting the nuclear deal but looking for continued sanctions by other means,” said Vali Nasr, a former Obama administration official and dean of the Paul H. Nitze School of Advanced International Studies in Washington. “That perception is damaging to President Rouhani, who’s taking credit for the deal.”

Iranian officials on Friday supported Mr. Rouhani’s order to accelerate development of the country’s ballistic missile program. They didn’t directly address the U.S. decision to delay those sanctions, however.

Eight members of parliament sent a letter to Mr. Rouhani in appreciation of his “decisive, precise and calculated response” to the planned U.S. missile sanctions, according to state media.

Mansour Haqiqatpour, a member of the Iranian parliament and the vice chairman of its national security and foreign-policy commission, said building nuclear-capable missiles was “not on Iran’s agenda.” He said there was no provision in the nuclear deal that bans ballistic missiles.

Sen. Coons’s stated concern about the White House’s inaction on the sanctions represents broader disquiet inside the Democratic Party about the nuclear deal. Mr. Obama won congressional support for the deal only after a bruising summerlong congressional debate. Two of the leading Democrats on the Senate Foreign Relations Committee, including its ranking member, Sen. Ben Cardin of Maryland, voted against it.

Mr. Coons said he supported the agreement on the condition that the White House vigorously enforced the deal and continued to take steps to constrain Iranian behavior in the Middle East. “I’m awaiting a clearer explanation, and hoping they’ll be taking action,” Mr. Coons said.

Former Secretary of State Hillary Clinton, the Democratic Party’s presidential front-runner, has also backed the deal while calling for its vigorous enforcement.

By Jay Solomon