The nuclear agreement signed between Iran and six world powers in July has “significantly increased” the threat to Israel posed by the Islamic republic, Yossi Cohen warned Wednesday as he was sworn in as the new head of the Mossad intelligence agency. Still, he added, he was confident the spy agency would be able to formulate an “appropriate response.”

“The key challenge is the Iranian threat,” Cohen said during the swearing-in ceremony at Mossad’s headquarters in Tel Aviv. “Despite the nuclear deal — I think because of it — the threat has significantly increased.”

Cohen, who previously served as Prime Minister Benjamin Netanyahu’s national security adviser, also pointed to internecine conflict in the Muslim world and the strengthening of regional terror organizations as a threat to the entire world, and to Israel in particular.

“Israel is at the epicenter of the storm gripping the Middle East in recent years,” Cohen said. “Fanatical Islamic extremism is rolling across countries, and causing their collapse,” he said.

“Iran continues to call for Israel’s destruction, while intensifying its military capabilities and strengthening its grip on the region,” Cohen said. “It employs terror cells as a means to achieve these goals.” Nonetheless, said Cohen, “I am confident the Mossad will be able to build the strength necessary (to counter the challenges) and form an appropriate response.”

Iran and its funding for terror organizations are by no means a new threat, but the regime’s coffers are soon to be refilled thanks to the lifting of sanctions, and its international standing and image have been improved by the nuclear deal reached last year. Most analysts believe that the likelihood of Israeli military intervention against Iran’s nuclear program has been drastically reduced in the wake of the deal, which Israel bitterly opposed, and which its Prime Minister Benjamin Netanyahu called a “historic mistake” that would “pave the way” to an Iranian nuclear arsenal.

Netanyahu presided over Wednesday’s ceremony, which was also attended by Cohen’s predecessor Tamir Pardo and other agency officials.

“The responsibility that the Mossad bears is immense,” Netanyahu said. “Our strength is contingent on the willingness of some of our best sons and daughters to bear the burden of ensuring life, liberty and prosperity of the nation,” he said.

“I trust you, Yossi, as does all of Israel.”

Cohen, a 54-year-old father of four, was born to a modern Orthodox family in Jerusalem, and grew up near the Netanyahus. His father, a seventh-generation Jerusalemite, was a veteran of the pre-state Irgun paramilitary force.

Judah Ari Gross contributed to this report.