Big powers, Iran far apart at nuclear talks

MOSCOW (Reuters) - Six world powers and Iran made little progress on Monday at the first of two days of talks on how to end a decade-long dispute over Tehran's nuclear program and avert the threat of a new war in the Middle East.

"We had an intense and tough exchange of views," said Michael Mann, spokesman for European Union foreign policy head Catherine Ashton who leads the delegation on behalf of the six powers: the United States, China, Russia, France, Britain and Germany.

Iran said before the talks began in Moscow that progress would be possible only if the powers acknowledged its right to enrich uranium, a process which Tehran says it uses only for peaceful purposes but which could also make weapons material.

A series of U.N. Security Council resolutions since 2006 have demanded that Iran suspend all its enrichment-related activities due to concerns about the nature of the nuclear program.

The world powers, the five permanent members of the U.N. Security Council - all of which have nuclear weapons - plus Germany, said it was time for Tehran to do more to assure them it was not seeking the bomb.

New U.S. and EU sanctions come into force in two weeks, Israel has threatened to bomb Iran if no solution to the dispute is found and oil markets are nervous over the prospect of intensifying regional tensions.

"The main stumbling block is that the sides' positions are rather difficult and tough to reconcile," Sergei Ryabkov, a Russian deputy foreign minister and negotiator, told reporters at the end of the first days of talks in a Moscow hotel.

An Iranian diplomat said: "Up to now the environment is not positive at all."

One Western official said: "If Iran remains unwilling to take the opportunities these talks present, it will face continuing and intensified pressure and isolation."

Experts said a breakthrough was unlikely, with the six powers wary of making concessions that would enable Tehran to draw out the talks and gain time to develop a nuclear weapons capability.

DANGEROUS STEP

The Moscow talks follow two rounds of negotiations since diplomacy resumed in April after a 15-month hiatus during which the West cranked up sanctions pressure.

As a priority, the West wants Iran to halt enrichment of uranium to 20 percent purity, a level much higher than what is needed for power generation, seen by some experts as a dangerous step towards being able to make bomb material.

In Iran, President Mahmoud Ahmadinejad said Tehran would be prepared to stop enriching uranium to a higher level if the six powers agreed to supply the fuel it needs for a Tehran reactor making medical isotopes.

"From the beginning the Islamic Republic has stated that if European countries provided 20 percent enriched fuel for Iran, it would not enrich to this level," Ahmadinejad said in comments published on the presidential website.

But it is not clear how much influence Ahmadinejad has over the negotiations and whether his remarks reflect Tehran's position. The president, who stands down at elections next year, has fallen out of favor with Supreme Leader Ayatollah Ali Khamenei, the man who has the ultimate decision-making power over the strategic nuclear program.

"A BOMB OR TO BOMB"

Iran is seeking an end to increasingly tough economic sanctions which have in recent months directly targeted its ability to export oil, its economic lifeblood.

An EU embargo on Iranian oil takes full effect on July 1 and new U.S. financial sanctions some days before that. Iran's crude oil exports have fallen by some 40 percent this year, according to the International Energy Agency.

Without progress to ensure Iran does not develop nuclear arms, Israel "could find itself facing the dilemma of 'a bomb, or to bomb'," Israeli Vice Prime Minister Moshe Yaalon said on Sunday.

"Should that be the choice, then bombing (Iran) is preferable to a bomb (in Iran's hands)," he said. "I hope we do not face that dilemma."

The six powers hope at least to win assurances that Tehran is willing to discuss concrete solutions.

They want a substantive response to their offer of fuel supplies for Tehran's research reactor and relief in sanctions on the sale of commercial aircraft parts to Iran.

At the last talks, in Baghdad last month, they asked Tehran in return to stop producing higher-grade uranium, ship any stockpile out of the country and close down an underground enrichment facility, Fordow.

But Iran's chief negotiator, Saeed Jalili, has indicated the incentives on offer are insufficient, although EU officials said last week that he had agreed to give serious consideration to the proposal.

Mistrust of Iran remains high. The International Atomic Energy Agency failed to persuade Iran, in talks this month, to let it inspect the Parchin military site where it suspects nuclear bomb-related research took place.

(Additional reporting by Fredrik Dahl in Vienna, Marcus George in Dubai, Thomas Grove in Moscow and Dan Williams in Jerusalem; Writing by Justyna Pawlak and Steve Gutterman; Editing by Timothy Heritage and Robin Pomeroy)

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