Speaking to reporters in Washington on Monday, Schroeder said Europeans would be well advised to put forward constructive proposals for moving nuclear talks forward at the next round of negotiations.
"We cannot bar them from civilian use of nuclear energy, but we need credible guarantees that they do not build atomic bombs," he said.
But European Union foreign policy chief Javier Solana said on Monday he saw no immediate reason to change policy on Iran, adding that nuclear talks with Tehran would continue.
"We don't have any reason to change at this time," Solana said.
The EU had previously offered Iran incentives to give up parts of its nuclear programme that could be used to develop weapons.
Britain, France and Germany are negotiating with Iran in the name of the 25-nation bloc for a halt to Iran's nuclear programme that they, along with the United States, suspect is a front for making atomic weapons.
"When we think about sanctions, it should be sanctions that do not hurt us more than the Iranians"
Iran, the world's fourth largest oil exporter, insists the programme is to meet soaring demand for electricity.
Schroeder and Solana's comments come after Mahmoud Ahmadinejad was elected Iran's new president on Friday.
Officials at the EU head office and Solana also demanded Iran address claims of voter irregularities in the presidential vote.
"I have some doubts about ... the manner in which the election has taken place," said Solana.
European Commission spokeswoman Emma Udwin said the EU, while it did not send election observers, was looking at the vetting procedures in the presidential elections, which she said "prevented a lot of candidates from standing".
"I have some doubts about ... the manner in which the election has taken place"
EU foreign policy chief
"There have been a number of allegations of voter irregularity," said Udwin, adding: "That's a serious matter, and we believe those complaints should be looked at swiftly and transparently."
Ahmadinejad, meanwhile, said he would press ahead with Iran's nuclear programme, but would not abandon talks with the EU, though his primary concern would be the national interest.
Washington wants Iran referred to the UN Security Council for possible sanctions over its nuclear programme, saying Tehran has persistently tried to cover up its activities and mislead the UN nuclear watchdog.
But when asked about the possibility of sanctions, Schroeder referred to the high price of oil, adding that "when we think about sanctions, it should be sanctions that do not hurt us more than the Iranians".
The German leader is in Washington for talks with US President George Bush.