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As Trump threatened Turkey with sanctions on Twitter last week, Erdogan shrugged off the threat, saying the USA is in no position to force Ankara back down. Turkey vowed retaliation "without delay", warning it would harm relations between the two allies.

The U.S. has prepared a list of Turkish entities and individuals that it will target should it decide to impose sanctions on Recep Tayyip Erdogan's government for imprisoning U.S. citizens and employees of its diplomatic mission, according to two people with knowledge of the matter.

In a news conference on Wednesday, White House press secretary Sarah Sanders stressed that the administration found Brunson's imprisonment to be "unfair and unjust" and that it saw "no evidence that Pastor Brunson has done anything wrong".

"Pastor Brunson's unjust detention and continued prosecution by Turkish officials is simply unacceptable", Treasury Secretary Steven Mnuchin said in a statement.

Last week, Israel confirmed USA media reports that President Donald Trump asked Israeli Prime Minister Benjamin Netanyahu to release Ebru Özkan, a Turkish woman accused of Hamas ties, in a July 14 phone call. While negotiations for his release were ongoing, President Donald Trump promised "large sanctions" in a tweet Wednesday.

"We call on the United States administration to walk back from this wrong decision", the Turkish foreign ministry said. It did not elaborate on possible measures. He added that Turkey expects the issue to be resolved through diplomacy, and foreign ministers of the two countries would meet this week.

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A Turkish justice ministry spokesman did not immediately comment on the sanctions.

Brunson was detained in the aftermath of a failed 2016 coup on charges of "committing crimes on behalf of terror groups without being a member" and espionage. If convicted, he faces 35 years in prison.

The evangelical pastor, who is originally from Black Mountain, North Carolina, has lived in Turkey for 23 years and led Izmir Resurrection Church. Sanctions under the act allow for the seizure of assets in the USA, travel bans and prohibitions on doing business with US entities.

Gul shrugged off the decision, writing on Twitter that he had no assets outside Turkey and that he dreamt of owning "a small olive grove" in his Turkish hometown.

Erdogan has denied speculation that there had been an agreement to swap Brunson for Turkish citizens being held overseas, particularly 27-year-old Ebru Ozkan.