TEHRAN, Iran - Iranian President Mahmoud Ahmadinejad criticized Russia on Wednesday for banning the delivery of S-300 anti-aircraft missile systems to Tehran, accusing Moscow of having caved in to "Satan."

In comments broadcast on state TV, Ahmadinejad said the 2007 contract Tehran signed with Moscow for the S-300 remains valid and warned that Russia must pay compensation and penalties for unilaterally canceling the deal.

The Iranian leader's remarks come after Russian President Dmitry Medvedev issued a decree in June banning all sales of the S-300 systems to Iran, saying the latest round of UN sanctions prevent it from delivering the system to Tehran.

The UN Security Council sanctions ban Iran from developing ballistic missiles capable of delivering nuclear weapons, investing in nuclear-related activities and buying certain types of heavy weapons. But they do not specifically prohibit Russia from supplying the S-300.

The anti-defense system is capable of shooting down aircraft and missiles at ranges of over 144 kilometres and at altitudes of about 27,432 metres. The system could have boosted Iran's ability to defend against airstrikes. Israel and the United States had objected to the deal.

"Some people are influenced by Satan. They thought the Iranian nation will be harmed if they unilaterally and illegally stop or cancel defense contracts they signed with us," Ahmadinejad said. He did not mention Russia by name, but it was clear that he was referring to Medvedev and the Russian leadership. Ahmadinejad said Moscow must pay compensation for canceling the deal.

"The contract is valid. They must implement it. If they don't, the Iranian nation will obtain its rights including compensation and penalties," he said.

Sergei Chemezov, the head of Russia's state-controlled Russian Technologies, said last month Moscow will return $166.8 million it received as payment from Iran. But he insisted that Russia owes nothing else to Iran, since the 2007 contract for the delivery of the S-300 missiles was canceled because of UN sanctions on Iran.

Ahmadinejad said Iran's security won't be at risk without the missiles.