* Trump: US could hit 52 Iranian sites if Iran attacks
* U.S. lacks courage for war, Iranian army chief says
* Iran summons Swiss envoy to protest Trump's 'hostility'
* Iraqi MPs seek resolution to kick out U.S. forces (Adds market reaction, comment by Pompeo, Hezbollah leader)
By Parisa Hafezi
DUBAI, Jan 5 (Reuters) - Iran condemned Donald Trump on Sunday as a "terrorist in a suit" after the U.S. president threatened to hit 52 Iranian sites hard if Tehran attacks Americans or U.S. assets in retaliation for the killing of military commander Qassem Soleimani.
As the two countries assailed each other in a war of words, the European Union, Britain and Oman urged both to make efforts to defuse the crisis.
Soleimani, Iran's pre-eminent military commander, was killed on Friday in a U.S. drone strike on his convoy at Baghdad airport, an attack that took long-running hostilities between Washington and Tehran into uncharted territory and raised the spectre of wider conflict in the Middle East.
Heightened fears of war drove Gulf stocks sharply lower on Sunday.
Hundreds of thousands of mourners, many chanting, beating their chests and wailing in grief, turned out across Iran to show their respects after Soleimani's body was returned home to a hero's welcome.
"Like ISIS, Like Hitler, Like Genghis! They all hate cultures. Trump is a terrorist in a suit. He will learn history very soon that NOBODY can defeat 'the Great Iranian Nation & Culture'," Information and Telecommunications Minister Mohammad Javad Azari-Jahromi tweeted.
Soleimani was the architect of Tehran's clandestine and military operations abroad as head of the Revolutionary Guards' Quds Force. Supreme Leader Ayatollah Ali Khamenei promised on Friday that Iran would seek harsh revenge for his death.
U.S. Secretary of State Mike Pompeo said that if there were further Iranian attacks on U.S. targets, Washington would respond with lawful strikes against decision-makers orchestrating such attacks.
"The intelligence assessment made clear that no action - allowing Soleimani to continue his plotting and his planning, his terror campaign - created more risk than taking the action that we took last week," Pompeo said on ABC's "This Week" show.
Democratic critics of the Republican president have said the strike that Trump authorised was reckless and risked more bloodshed in a dangerous region.
Trump tweeted on Saturday that Iran "is talking very boldly about targeting certain USA assets".
He said the United States has "targeted 52 Iranian sites", some "at a very high level & important to Iran & the Iranian culture, and those targets, and Iran itself, WILL BE HIT VERY FAST AND VERY HARD".
The 52 targets represented the 52 Americans held hostage in Iran after being seized at the U.S. Embassy in 1979 during the country's Islamic Revolution, Trump said.
Iran summoned the Swiss envoy representing U.S. interests in Tehran on Sunday to protest at "Trump's hostile remarks", according to Iranian state television.
EU foreign policy chief Josep Borrell urged Iran's foreign minister by phone to work to de-escalate the situation and invited him to Brussels to discuss ways of preserving world powers' 2015 nuclear deal with Iran.
It was Trump's withdrawal of the United States from the deal in 2018 and reimposition of sanctions on Iran that touched off a new spiral of tensions after a brief thaw following the accord.
Iran will decide on Sunday about its next step to further roll back its commitments to the nuclear containment deal, Foreign Ministry spokesman Abbas Mousavi was quoted as saying.
"Considering the recent threats (by America) it should be underlined that in politics, all developments and threats are linked to each other," state news agency IRNA quoted him as saying.
IRAQI LAWMAKERS WANT U.S. FORCES OUT
In Iraq, many people including opponents of Soleimani have expressed anger at Washington for killing him and Iraqi militia leader Abu Mahdi al-Muhandis on Iraqi soil and potentially dragging their country into another war.
Lawmakers planned to use a special parliamentary session being held on Sunday to push for a vote on a resolution requiring the government to ask Washington to withdraw U.S. troops from the country.
"There is no need for the presence of American forces after defeating Daesh (Islamic State)," said Ammar al-Shibli, a Shi'ite lawmaker and member of the parliamentary legal committee.
Despite decades of enmity between Iran and the United States, Iran-backed militia and U.S. troops fought side by side during Iraq's 2014-2017 war against Islamic State militants.
The militia were incorporated into government forces under the umbrella of the Popular Mobilisation Forces led by Muhandis. Some 5,000 U.S. troops remain in Iraq, most in an advisory role.
IRAN SAYS U.S. HAS NO COURAGE FOR WAR
Iran's army chief, Major General Abdolrahim Mousavi, was quoted by state television on Sunday as saying the United States lacked the courage for military confrontation with Iran.
Sayyed Hassan Nasrallah, leader of Lebanon's powerful, Iran-allied Hezbollah movement, said Soleimani's killing marked "the start of a new phase and new history not just for Iran or Iraq but the whole region". Hezbollah has had numerous conflicts with U.S. ally Israel, including a month-long war in 2006.
Oman has called on the United States and Iran to seek dialogue to ease tensions, Oman News Agency reported on Sunday. Oman, which has friendly ties with the United States and Iran alike, has previously been a go-between for the two countries.
Britain also urged a de-escalation of tension.
Huge crowds turned out to greet the body of Soleimani when it returned to Iran. While many Iranians have rallied to show grief over the death of Soleimani, seen as the country's second most powerful figure after Khamenei, others worry it might push Iran into war with a superpower.
(Additional reporting by Kylie MacLellan in London, Ahmed Rasheed in Baghdad, Babak Dehghanpisheh in Dubai, Francesco Guarascio in Brussels, Tom Perry in Beirut, Daphne Psaledakis and Doina Chiacu in Washington, Ateeq Shariff in Bengaluru Writing by Mark Heinrich Editing by Frances Kerry)
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