Rice backs EU over action on Iran

fri 13th Jan 2006 - US Secretary of State Condoleezza Rice has urged the UN to confront Iran's "defiance" over its nuclear programme. Earlier, foreign ministers from the UK, France and Germany said the time had come for Iran's nuclear issue to be dealt with by the UN Security Council. Iran says it will end all voluntary co-operation over its nuclear policy, if it is referred to the Council. Russia did not rule out referring Iran to the UN, but said not all diplomatic steps had been taken.

The UK, France and Germany - the so-called EU three - met in Berlin on Thursday in response to Iran's decision to resume nuclear research this week. Speaking afterwards, they said talks with Iran had reached a "dead end" and called for an emergency session of the UN's nuclear watchdog, which could refer Iran to the council and lead to possible sanctions.

Military option

Ms Rice backed the EU move, saying: "These provocative actions by the Iranian regime have shattered the basis for negotiation." Speaking to reporters in Washington, she said Tehran had deliberately escalated the situation and was "in dangerous defiance of the entire international community".

IRAN'S NUCLEAR STANDOFF

Sept 2002: Work begins on Iran's first reactor at Bushehr
Dec 2002: Satellites reveal Arak and Natanz sites triggering IAEA inspections
Nov 2003: Iran suspends uranium enrichment and allows tougher inspections
June 2004: IAEA rebukes Iran for not fully co-operating
Nov 2004: Iran suspends enrichment under deal with EU
Aug 2005: Iran rejects EU plan and re-opens Isfahan plant
Jan 2006: Iran re-opens Natanz facility

Ms Rice talked of "a menu of possibilities" for diplomatic action against Iran. But she said the US did not "at this point" have on its agenda the option of military action. The BBC's Justin Webb in Washington says her words show the White House is well aware that the coming diplomatic showdown with Iran cannot be managed alone. Mr Bush is to meet the new German Chancellor Angela Merkel on Friday in an attempt to improve relations and win German support for a tough line against Tehran, our correspondent adds.

The US and members of the EU have accused Iran of covertly seeking to develop nuclear weapons. Tehran insists its nuclear programme is for peaceful purposes only. UN Secretary General Kofi Annan told the BBC that Iran's chief nuclear negotiator, Ali Larijani, had told him Iran remained "interested in serious and constructive negotiations, but within a time-frame". Mr Annan said he was keen for the issue to be resolved through the IAEA if possible. Top Japanese officials said there would be no option but to refer Iran to the Security Council unless it "changes its behaviour" over its nuclear activities.

Hardline policies

Foreign Minister Manuchehr Mottaki said Iran would end snap UN checks of its atomic facilities and would resume uranium enrichment if its case was sent to the Security Council.

"The government will be obliged to end all of its voluntary measures if sent to the UN council," Mr Mottaki was quoted as saying by the official IRNA news agency.

The crisis over Iran's nuclear programme intensified this week after Iran removed seals at three nuclear facilities, including a uranium enrichment plant at Natanz, following a two-year freeze. Since last August, Iran has resumed all nuclear activity apart from enrichment, which can produce fuel for power stations or, under certain conditions, for bombs. - BBC

Iran threatens to curb inspections Fri Jan 13, 2006 - By Parisa Hafezi TEHRAN (Reuters) - Iran threatened on Friday to block snap U.N. inspections of its nuclear facilities if it is taken to the U.N. Security Council, but the United States said the West would not be deflected from that course.

"I'm not going to prejudge what the United Nations Security Council should do," President George W. Bush told a news conference in Washington with German Chancellor Angela Merkel. "But I recognize that it's logical that a country which has rejected diplomatic entreaties be sent to the United Nations Security Council."

Iran raised the stakes in its dispute with the West this week by removing U.N. seals on equipment that purifies uranium, which can be used for power, or if highly enriched, in bombs. The United States and the European Union's three biggest powers said talks with Iran on the issue were at a dead end. Tehran denies accusations it is seeking nuclear weapons and says it needs nuclear technology to generate electricity.

Iranian Foreign Minister Manouchehr Mottaki said bringing Iran before the Security Council, as threatened by the United States and European powers on Thursday, would have "consequences" for the West and Tehran would have to "end all of its voluntary measures" in response. Iran has repeatedly threatened to end snap checks and resume uranium enrichment if taken to the Council.

Iran's cooperation with snap U.N. inspections is voluntary, but halting them would reduce its cooperation with the U.N. nuclear watchdog to the legal minimum. Iran's new representative to the Vienna-based International Atomic Energy Agency, Aliasghar Soltaniyeh, said Tehran remained "fully committed" to the nuclear Non-Proliferation Treaty and its statutory obligations to the IAEA.

Bush noted that the United States and other nations had "made it abundantly clear" to Tehran that developing nuclear capabilities or weapons was not acceptable. "And the reason it's unacceptable is because Iran armed with a nuclear weapon represents a grave threat to the security of the world," he said, noting that Iranian President Mahmoud Ahmadinejad had only recently declared the destruction of Israel was an important part of his agenda.

EU-3 AND U.S. TOGETHER

The EU-3 -- Britain, Germany and France -- said Iran had consistently breached its commitments and failed to show the world its nuclear activities were peaceful.

"It's essential we feel that the EU-3 together with the United States take a common position here, become active, that we try to persuade as many other countries as possible ... to ally themselves with us, and we will certainly not be intimidated by a country such as Iran," Merkel said.

Ahmadinejad has accused other countries of trying to keep nuclear technology for themselves. A top Iranian cleric said the Islamic republic was the target of a 'psychological war' to force it to abandon nuclear work. 'This nation is not a nation to yield to such pressures,' Ahmad Khatami told Friday prayer worshipers.

The Iran crisis is affecting financial markets. Oil rose above $64 a barrel on Friday and investors sought safe havens, like the Swiss franc, in case the crisis deepened. The board of the IAEA, which has found no firm proof Iran is seeking nuclear arms, is expected to meet in early February to consider referring Iran to the Security Council.

In the past, Russia and China have opposed this.

China's U.N. ambassador Wang Guangya said Beijing feared taking the case to the council "might complicate the issue" and could harden the positions of some parties, citing Tehran's threat to halt snap U.N. nuclear inspections. China has considerable economic relations with Tehran and imported 12 percent of its crude oil from Iran in the first 11 months of 2005. It traditionally opposes sanctions, saying they are a violation of other countries internal affairs.

Iran is the world's fourth-biggest oil exporter.

Russia will go ahead with a $1 billion deal to sell short-range missiles to Iran despite the nuclear dispute, Russian Defense Minister Sergei Ivanov said. He said Moscow's proposal to enrich uranium for Iran on Russian soil -- a compromise rejected by Tehran but seen by the West as an option to defuse the crisis -- was still on offer.

(Additional reporting by Louis Charbonneau in Berlin, Katherine Baldwin in London, Oleg Shchedrov in Moscow, Boris Groendahl in Vienna, Irwin Arieff at the United Nations and Steve Holland in Washington) - reuters

NUCLEAR STATUS: IRAN'S PATH TO THE BOMB

More Lies about Iran

By Mike Whitney 01/15/06 "ICH" -- -- There's been a lot of rubbish written about Iran's "removing the seals" from its uranium enrichment equipment.

The fear-mongering western media have exploited the expression for all its worth. Even those who are normally skeptical of the Bush-propaganda machine are taken aback by this ominous-sounding phrase.

What gibberish!

How else does one make nuclear fuel for electric power plants if the fuel-producing mechanism is under lock and key?

The fear-engendering description provided in the news would have the reader believe that "diabolical" Iranians are ripping off the seals with crowbars so they can quickly assemble their secret nuclear stockpile to bomb Tel Aviv.

This is the worse type of demagoguery.

The fuel that is produced from these uranium enrichment reactors DOES NOT PRODUCE WEAPONS-GRADE MATERIAL. That requires thousands of centrifuges which Iran does not have.

At the same time, the nuclear watchdog agency, the IAEA, has on-site inspectors and cameras monitoring the entire process.

Everything is under constant observation.

Additionally, as nuclear weapons physicist, Gordon Prather states, "After almost three years of go-anywhere see-anything interview-anyone inspections, IAEA inspectors have yet to find any indication that Iran has—or ever had—a nuclear weapons program".

Get it???

No nukes! Not now…not ever!

The public has been duped again by the intentionally misleading rhetoric and blatant lies of the MSM and the Bush administration to build the case for war with Iran. What could be more clear?

The public does have a choice, however; either they can accept the credible statements from the Nobel Prize-winning Mohammed Elbaradei, chief of the IAEA, or the spurious allegations of the Liar-and-Chief.

Which will it be?

"Removing the Seals?"

So, why were the seals put on the Iranian conversion equipment?

Was Iran being punished for violations to the NPT (Non Proliferation Treaty) for secretly developing nuclear weapons?

No, but this seems to be the conclusion of most people who haven't followed the issue closely.

The seals were put in place because the Iranian negotiators foolishly fell into a trap that was set by the EU-3. (England, France and Germany) Iran agreed to "confidence-building" measures that would placate the United States, which included "additional protocols" that were not demanded under the terms of the treaty or required by the IAEA. As it turns out, the EU used the extra concessions to make it look like Iran was violating the NPT after negotiations had ended.

The EU strategy was a clever ploy that worked like a charm, but that doesn't change the facts:

IRAN HAS NOT VIOLATED ITS TREATY OBLIGATIONS, AND THE AGREEMENT WITH THE EU-3 WAS NEITHER BINDING NOR DESIGNED TO BE PERMANENT.

Iran has never given up its "inalienable right" (language of the NPT) to enrich uranium for peaceful purposes.

Was Iran foolish to trust the EU-3? (not suspecting that Washington was orchestrating a media-coup behind the scenes)

Yes, they were… but that is not a violation of the treaty; that's simply being deceived by some very brainy neocons.

Iran has completely cooperated with the IAEA to ensure that it stays within the rules and does not develop highly-enriched, weapons grade material.

Presently, Iran poses no threat to either its neighbors or the United States.

The Bush administration does not accept the internationally-recognized treaty rights of Iran because it believes that all law flows from Washington; a fact that is tragically evident in its torturing of prisoners, spying on American citizens, and its vast destruction of Iraq.

As long as the Bush-media, which serves as an annex to the political establish, can continue to hoodwink the American people with its alarmist misinformation; there's little chance that a war with Iran will be avoided.

- information clearing house

Britain rejects Iranian calls for fresh nuclear talks

By Roula Khalaf in London, Najmeh Bozorgmehr in Tehran, Hugh Williamson in Berlin and Neil Buckley in Moscow Published: January 17 2006 -

Britain on Tuesday dismissed Iranian calls for a resumption of nuclear negotiations and said Tehran's renewed interest in a Russian proposal to settle the nuclear dispute was a delaying tactic.

An Iranian official told the FT that Tehran had sent a letter to the EU3 - France, Germany and Britain - on Sunday, calling for continuation of nuclear talks.

But the EU3 declared the negotiations at a dead end last week - after Iran resumed uranium enrichment research - and are now pushing to report Tehran to the UN Security Council.

A British official described Iran's call for talks as "vacuous."

The EU3 say Tehran must reinstate its suspension of all enrichment related activities before new negotiations are considered - a move rejected by Iran. In an apparent attempt to influence the international debate, Tehran has also shown interest in recent days in a Russian initiative to set up a joint venture on Russian territory to provide for all Iran's future nuclear fuel needs. Russia says the proposal is still on the table and is hoping Tehran will accept it to defuse the crisis. Talks between Russian and Iranian officials on the iniatitive are scheduled for mid-February.

But a British official suggested on Tuesday that Iran was "playing with the Russia proposal for tactical reasons".

European governments have called for an extraordinary meeting of the governing board of the International Atomic Energy Agency, the UN's nuclear watchdog, on February 2-3 and want to pass a resolution sending the controversy to the UN Security Council. France, Britain and Germany began circulating a draft resolution to that effect on Wednesday. European officials said talks with the US, Russia and China in London on Monday had not reached a conclusion but that Britain, France and Germany were confident they could secure a majority of votes at the 35-member IAEA board for a resolution sending the dispute to the UN Security Council. Officials insisted that sanctions against Iran were not under consideration at this point. They said they wanted the Security Council to strengthen the hand of UN inspectors and raise the pressure on Tehran to resume the suspension of sensitive nuclear work.

Senior German officials, however, acknowledged the London talks had not produced unity on what exactly the IAEA should agree upon. Gernot Erler, deputy foreign minister, said that "we are still talking [with the five permanent members of the UN Security Council] about what should be decided [at the IAEA meeting] and what the role of the UN should be."

An official close to foreign minister Frank-Walter Steinmeier said "much now depends of whether Beijing and Moscow get on board" in putting pressure in Tehran.

European officials have been expecting Russia to abstain when the IAEA board considers a referral resolution. But China has been more resistant to involving the Security Council.

While not ruling out a referral to the council, Vladimir Putin, Russian president, has warned against "abrupt, erroneous steps". In Moscow on Tuesday, Sergei Lavrov, the foreign minister, struck a cautious note, saying sanctions were not the best way to solve the problem of Iran's nuclear programme.

Philippe Douste-Blazy, French foreign minister, will be in Russia on Wednesday and will hold more discussions on Iran. - FT COM

France ready to use nuclear arms: Chirac

19 January 2006 16:35

The French President, Jacques Chirac, has said France would be ready to use nuclear weapons against any state that carried out a terrorist attack on its soil. Mr Chirac said he reserved his country's right to use non-conventional weapons after any terrorist attack or an attack that used weapons of mass destruction. It was the first time he clearly linked the threat of a nuclear response to a terrorist attack.

The French leader did not say whether France would be prepared to use pre-emptive strikes against a country it saw as a threat. France has had nuclear weapons since the 1960s and experts believe it has some 300 nuclear warheads.

Call for restraint over Iran

China has called for restraint in the dispute over Iran's nuclear programme. The government in Beijing said it was waiting to see a draft resolution that seeks to bring Iran before the UN Security Council for possible sanctions. China is one of the permanent members of the UNSC that can wield a veto over any proposals.

The other permanent members are the US, France, Britain and Russia.

It is thought that China, eager to get more access to Iran's oil and gas to feed its booming economic development, would be unlikely to support UN-imposed sanctions against Iran.

Iran ready to compromise

Iran's top nuclear negotiator has indicated that his country is ready to compromise over its nuclear programme. Ali Larijani said Tehran was willing to discuss the outside world's concern about diversion of nuclear fuel for an alleged weapons programme and offer guarantees.

However, the US Secretary of State, Condoleezza Rice, had earlier said there was no point in negotiations unless Iran offered fresh concrete proposals for talks.

Yesterday, Britain, France and Germany began circulating a draft resolution asking the UN's nuclear watchdog, the International Atomic Energy Agency, to refer Iran to the UNSC. The Iranian President, Mahmoud Ahmadinejad, has criticised the draft, saying it is politically motivated. The governing board of the IAEA is to hold a meeting on 2 February to discuss the issue. - rte.ie

Iran's really big weapon

By MARTIN WALKER UPI Editor WASHINGTON, Jan. 18 (UPI) -- The prospect of a mushroom cloud rising from the Dasht-e-Lut, Iran's Desert of Stones, may not be Tehran's greatest threat to international stability. A successful test of an Iranian nuclear weapon at some point in the next few years may prove less destabilizing than a simple free market economic measure that Iran is said to be planning for March of this year.

Tehran is preparing to open a bourse, a mercantile exchange and potentially a futures market, where traders can buy and sell oil and gas, along the lines of the International Petroleum Exchange (IPE) in London and the NYTMEX in New York.

The differences are first, that this one would price its energy in euros, not dollars, and second, that it would not use West Texas Intermediate or Brent Crude (from the North Sea) as its standard oil for pricing. It would use a Persian Gulf-produced oil instead.

So what? This sounds like a minor change, and possibly even a useful one, broadening the choice among traders and consumers in the kind of way that Adam Smith, the 18th century father of modern capitalism, would have recommended.

Not so. This could be a far more profoundly punishing blow to American interests than Iran's ability to manufacture a crude atom bomb that would have little credibility until it became small and stable and reliable enough to be delivered on some putative target.

The relationship between the oil price and dollar is intimate and important, and very useful to the dollar's highly profitable status as the world's reserve currency. The prospect of a rival bourse and futures market opens the intriguing possibility, beyond hedging the future oil price, of profitable arbitrage between the euro and the dollar.

And if oil and gas are to be denominated in more than just one currency, why not open the trade to others? Why not denominate the price of a barrel of oil in Japanese Yen, or in Chinese yuan, the currency of the world's second biggest oil importer?

Why not, in short, end the monopoly rule of the almighty dollar?

Such a move would not be welcomed in Washington, which swiftly moved after the fall of Baghdad in 2003 to reverse Saddam Hussein's impudent decision to start selling Iraqi oil for euros, rather than dollars. After all, the great benefit of running the world's reserve currency means that if all else fails, the United States Treasury can just print more and more of the stuff and pay for its oil imports that way.

There are, naturally, limits to the degree to which the United States can debase its currency, as the world found with the first great OPEC price rise of 1973, when the price per barrel tripled. This is usually attributed to the political decision by Saudi Arabia and other Arab oil producers to punish the United States for its decisive support of Israel in the Yom Kippur War. That is partly true, but the crucial OPEC decision was as a direct result of President Richard Nixon's Aug. 15 decision to end the dollar's link to the gold standard.

The dollar declined in value, which meant the OPEC producers received less value for their oil. So at their Beirut meeting on Sept. 22, OPEC adopted resolution XXV:140, which resolved to take "any necessary action ... to offset any adverse effects on the per barrel real income of member countries resulting from the international monetary developments as of Aug. 15."

That was also the time when Sheikh Zaki Yamani, the Saudi oil minister, first mentioned the possibility of deploying the ultimate weapon of an oil embargo.

Most of the financial world is currently awaiting another, similar devaluation of the dollar, in response to the monstrous scale of current deficit on the U.S. current account. Writing in the Financial Times last week, Harvard Professor Marty Feldstein suggested that on the basis of the 1985-87 Louvre and Plaza devaluations, the dollar could fall as much as 40 percent or even more.

The markets simply do not know when. But should it come after an Iranian bourse is up and running, some very tidy sums could be made by those playing a dollar-euro trade on Tehran's energy futures market.

The Tehran bourse is listed as an objective for this year in Iran's current five-year plan. The Tehran Times reported July 26 that the final authorizations had been received for the bourse to go ahead. Mohammad Javad Asemipour, the technocrat and former deputy petroleum minister who has been charged with launching the bourse, has made a number of discreet scouting trips to London, Frankfurt, Moscow and Paris. Just after Christmas, he was quoted by the Iran Labor News Agency saying "transparency in oil transactions would be one of the advantages of having such an establishment "(the bourse), and adding that this would "allow dealers access to related information and promote equal trade opportunities."

Asemipour is an elusive type, but one who seems convinced that Iran can play off the European against the Americans, the euro against the dollar. Just over a year ago, he was quoted in the quasi-official Iran Daily saying that the Europeans have played "a beautiful game" with the United States during the years of sanctions, when they actively participated in economic projects, particularly in the energy sector, across Iran.

"In this game, the Europeans have pretended to be siding with America, whereas they got involved in business here and developed a sort of competition with the Americans," he said. "But in practice, they (the Europeans) have pursued their own interests." There is no shortage of officials in the Bush administration who nurture such suspicions of the French and Germans, despite what seems at the moment to be a common concern about Iran's nuclear ambitions.

The question now is whether the world's traders will come to a Tehran Bourse if and when it opens, bearing in mind that a similar idea in Dubai failed to gain much traction. But that was before oil prices reached $65 a barrel, and before the Dubai's partners in the Gulf Cooperation Council decided it was time to stop glowering at Iran as a potential enemy, and started to invite Tehran to their meetings as an observer. Before, that is, the Arab world began to judge that whatever the American intentions, Iran had become the real winner of the Iraq War.

The world could be about to change much faster than we think, whether or not Iran tests an atomic device. There are other, possibly more devastating weapons available that could hit a financially vulnerable American where it hurts most. - upi.com

Iran threatens oil crisis in nuclear standoff

Thu Jan 19, TEHRAN (AFP) - Iran warned of a world oil crisis if sanctions are imposed over its nuclear program even as the United States and Europe struggled to get support for UN Security Council action.

"In case of sanctions, other countries will suffer as well as Iran," Oil Minister Davoud Danesh-Jafari said, according to the official news agency, IRNA. "One of the consequences will be the unleashing of a crisis in the oil sector and particularly a price hike."

Iran, the number two oil exporter in OPEC with oil revenue last year of 42 billion dollars, risks being referred to the United Nations Security Council over what the West suspects is a covert nuclear weapons drive. World oil prices this week hit a near-four-month high in New York, partly on fears of Iran sanctions.

The nuclear standoff came to a head when Iran broke international seals last week to restart uranium enrichment research which had been suspended for two years under deals with the Europeans. But the United States and Europe are facing resistance, particularly from permanent UN Security Council members China and Russia, to their push for a referral to the world body and possible sanctions.

"We have been very clear that we believe the time has come for a referral of Iran to the Security Council," US Secretary of State Condoleezza Rice said in Washington. Rice said Iran had been given adequate opportunities to resolve the nuclear issue through negotiations and prove to the world that it was not seeking nuclear weapons.

Russia, which is Iran's main partner in the growing civil nuclear programme, has been trying to steer away from a UN showdown. China has also opposed such a step. Britain, France and Germany, backed by the United States, have called for an emergency meeting of the International Atomic Energy Agency (IAEA) on February 2, a first step before possible UN Security Council referral.

Iran insists it is not seeking to build nuclear weapons and that it has the right to develop atomic energy. It has threatened to suspend snap inspections by the IAEA if it is brought before the Security Council.

But the Western powers have rejected Iran's call for a return to direct talks, Britain describing it as "vacuous", unless there is a return to the fuel cycle suspension. French Foreign Minister Philippe Douste-Blazy met with resistance when he held talks in Moscow with his Russian counterpart Sergei Lavrov to get support for UN action.

"We must simultaneously be united but also firm, to tell the Iranians to return to reason, to stop these dangerous nuclear activities and to let us negotiate together," Douste-Blazy told reporters after the talks.

But Lavrov reiterated Russia's attempts to strike a less confrontational stance.

"We need to act exactly as in medicine," he told journalists. "First understand what method is the most effective -- the scalpel or therapy. Only then do you understand all the aftereffects of further steps. Only then should you act."

As the world powers appeared split, Iran secured backing from Syrian President Bashar al-Assad, who pledged support for Iran's nuclear programme and rejected pressure on Tehran.

"We expressed our support for Iran in its pursuit of peaceful nuclear technology and we back the idea of a dialogue with international parties," Assad said after talks with Iranian President Mahmoud Ahmadinejad. "We also reject the pressure being exerted on this country" over its nuclear programme, he said.

Tehran denied a newspaper report that Iran was moving billions of dollars in hard currency from European banks to Asia and said Europe had no right to freeze its assets.

Economy Minister Davoud Danesh-Jafari dismissed a report in pan-Arab newspaper Asharq al-Awsat that Iran had ordered government departments to withdraw currency from European banks, fearing possible sanctions over its disputed nuclear programme. Danesh-Jafari described the news report as "politicized" and "media-driven." "International law does not allow Europeans to do such a thing (freeze assets)," Danesh-Jafari said.

Iranian hard currency reserves in foreign banks, mainly European banks, are valued at more than 36 billion dollars.

A US senator said he planned to introduce a bill calling on President George W. Bush's administration to press governments around the world to shun Iran over its nuclear program. Democratic Senator Evan Bayh, speaking on US television, said he plans to introduce his resolution Friday, calling for Iran to be excluded from international forums and events and asking the administration to urge other governments to sever economic relations with Tehran. - news.yahoo.com

Rice: No Point in More Iran Negotiations

With U.S. Backing, France Rejects Iran Request for More Talks; Rice Says 'Not Much to Talk About'

By NASSER KARIMI The Associated Press TEHRAN, Iran - France, with the support of the United States, rejected Iran's request for more negotiations on the Islamic republic's nuclear program, with Secretary of State Condoleezza Rice saying Wednesday "there's not much to talk about" after Iran resumed atomic activities.

As European countries pushed ahead with efforts to have Iran brought before the U.N. Security Council for its nuclear activities, President Mahmoud Ahmadinejad accused them of trying to deprive Iran of peaceful technology.

"We are asking they step down from their ivory towers and act with a little logic," Ahmadinejad said. "Who are you to deprive us from fulfilling our goals? "You think you are the lord of the world and everybody should follow you. But that idea is a wrong idea."

In Vienna, Austria, the International Atomic Energy Agency said a special meeting of its 35-nation board of governors would be held Feb. 2 at the request of Britain, France and Germany.

French Prime Minister Dominique de Villepin said European nations were seeking the "greatest possible consensus" on dealing with Iran, and the upcoming meeting was a "very important moment." "What we wish is that there is the greatest possible consensus to mark clearly the limit of what we can accept," he said in Berlin after meeting with German Chancellor Angela Merkel.

Earlier, Iran's foreign minister said he did not believe the country would be referred to the Security Council, which has the power to impose economic and political sanctions. However, diplomats say the council is unlikely to take such action since China and Russia, two veto-wielding members, oppose referral. Tehran's defiant tone came as France, with U.S. backing, rejected Iran's request for a resumption of negotiations, saying Tehran must first suspend its nuclear-related activities.

Iran asked for a ministerial-level meeting with France, Germany, Britain and the European Union, but its decision to resume some uranium enrichment-related activities "means that it is not possible for us to meet under satisfactory conditions to pursue these discussions," French Foreign Ministry spokesman Denis Simonneau said in Paris. "Iran must return to a complete suspension of these activities."

In Washington, Rice and EU foreign policy chief Javier Solana also rejected any return to talks. "There's not much to talk about," Rice said during a photo session at the State Department with Solana.

Rice said Iran must not be allowed to have a nuclear weapons capability or "to pursue activities that might to a nuclear weapons capability."

Later, during a speech at Georgetown University, Rice said the international community was united in its belief that Iran "stepped over a line when it broke the seals" at its main uranium enrichment facility and resumed reprocessing nuclear fuel. "The Iranians want to make this about their rights. It's not about their rights," Rice said. "It's about the ability of the international system to trust them with the capabilities and technologies that could lead to a nuclear weapon. "They have a history with IAEA of not disclosing, with covering their activities and so no one does trust them with those technologies."

Solana agreed that "there is not much point" in resuming talks if there is "nothing new on the table."

The European countries have drawn up a draft IAEA resolution asking the Security Council to press Tehran "to extend full and prompt cooperation to the agency" in its investigation of suspect nuclear activities though it stops short of asking the council to impose sanctions.

A European diplomat accredited to the IAEA said Wednesday there were no significant changes in the language of the draft resolution. "We are pretty well where we were yesterday," the diplomat said on condition of anonymity because he was not authorized to speak to the media about the draft.

Russia and China as well as Egypt, which also sits on the 35-nation IAEA Board of Governors are reluctant to support Iran's referral.

"In view of the overall situation, we regard the possibility of the hauling of Iran's nuclear case to the Security Council to be weak," Iranian Foreign Minister Manouchehr Mottaki told state radio. "During the past 10 days we have tried to relay our message to all relevant parties, including the Europeans, about Iran's readiness to negotiate on the production of nuclear fuel."

Mottaki said he hoped European countries would avoid taking steps that could only worsen the current situation an apparent reference to U.S. and European talk of sanctions.

Ahmadinejad shrugged off the draft resolution, calling it politically motivated and said he was unconcerned by the attempts to refer Iran to the council. "There isn't any problem. This is their endeavor. We can't stop others from trying," he told reporters.

The United States accuses Iran of trying to secretly build nuclear weapons a charge Iran denies. Britain, France and Germany, with U.S. backing, have been trying to persuade Iran to import nuclear fuel instead of having its own uranium enrichment program, but Iran has rejected this. The Bush administration sent U.S. Undersecretary of State Nicholas Burns to London to coordinate a strategy with Britain, China, France, Germany and Russia on dealing with Iran. Burns conceded differences remained after Tuesday's meeting.

"We reached a consensus on some points ... others need to be worked on," he said in Bombay, India, during a South Asia tour. "There is a consensus that Iran should turn back, return to negotiations and suspend its nuclear program. But that's not the path Iran is on now."

A delegation of Israeli security experts was in Moscow on Wednesday to meet with Russia's Security Council and Foreign Ministry in hopes of winning Russian backing for Security Council referral. Russia's Interfax news agency said the head of country's nuclear energy agency, Sergei Kiriyenko, met with the delegation led by Israeli National Security Chief Giora Eiland.

French Foreign Minister Philippe Douste-Blazy was scheduled to meet with Russian officials on Thursday. Associated Press reporter George Jahn in Vienna, Austria, contributed to this report. - abc

Iran calls for oil output cut

By Gareth Smyth and Najmeh Bozorgmehr in Tehran and Carola Hoyos in London Published: January 20 2006

Iran has called for a cut in global oil production while simultaneously preparing to shift its foreign assets out of Europe.

The moves were widely interpreted as a signal that Iran is preparing for a long stand-off with the west and sees oil production as a counter weight to international economic pressure.

Tehran's call on Friday for the Organisation of the Petroleum Exporting Countries to reduce production by 1m barrels a day helped take prices up to a four-month high of more than $68 a barrel, even though Iran is the only Opec member to call for the cut and is unlikely to find much support for the measure at Opec's meeting in Vienna on January 31.

Some traders said Iran's comment was a sign that Tehran might be willing to use the threat of halting its substantial oil production as a political tool in its nuclear spat with the west. Iran is the fourth biggest oil exporter and main supplier to Japan, South Korea, France and Italy. The media in Iran this week has highlighted the upward pressure on oil prices simply through talk of sanctions.

Just hours earlier, Ebrahim Sheibani, the Central Bank governor, said Iran would "transfer the foreign exchange reserves wherever we consider expedient" and confirmed a shift from Europe had begun.

Analysts say Iran is fearful that its deteriorating relationship with Europe could lead to a seizure of assets.

Mr Sheibani refused to give details or to say where Iran's funds were going, although several local news agencies reported the destination was south-east Asia. The Central Bank manages Iran's "windfall" oil revenue in the Oil Stabilisation Fund, which Mr Sheibani said would contain about $15bn (€12.4bn) by the end of March. Iran keeps an unknown amount of this in Europe.

According to the International Monetary Fund, Iran's foreign exchange reserves are $30.6bn in hard currency. Tehran has another $9bn in foreign assets (but not necessarily liquid) abroad, it says.

A court in Rome last month ordered Banca Nazionale del Lavoro to freeze an account held by the Iranian government, pending a lawsuit over the deaths of three Americans in the Israeli-occupied Palestinian territories.

Iran has protested that its official accounts were protected by the Vienna Convention governing diplomatic relations. But families of US citizens killed in the bombing of its Beirut embassy in 1983 by Hizbollah, the Lebanese Shia militant group, plan to follow suit – asking European courts to seize Iranian assets after a US ruling that Iran should pay $126m in damages. - FT.com

Israel says it is preparing to attack Iran

Monday 23rd January, 2006

Israel is threatening to launch a pre-emptive strike against Iran's nuclear program.

Defense Minister Shaul Mofaz has hinted that Israel is preparing for military action against Iran's nuclear facilities. "Israel cannot accept an Iranian nuclear capability and it must defend itself, with all that that implies," Mofaz said. "We are preparing," he added.

But Mofaz said international diplomacy must be the first course of action. He welcomed the U.S.-led effort to bring Iran before the U.N. Security Council, saying sanctions and international oversight of Iran's nuclear program are the "correct policy at this time."

Israel has expressed growing alarm about Iran's nuclear program since late October, when the Iranian president called for the Jewish state to be "wiped off the map." Israeli spokesman Mark Regev says the U.S. and Europe must move more quickly to prevent Iran from acquiring the atom bomb.

"The combination of a regime with a very radical agenda, put together with nuclear weapons, I think that is a combination, a dangerous combination that no one in the international community can accept," said Regev.

The Israeli air force destroyed the Iraqi nuclear reactor in 1981, and Israeli officials have warned repeatedly that if diplomacy fails, there is a military option. - Big News Network.com

Iran backs Russian uranium enrichment plan

Wed Jan 25, MOSCOW (AFP) - Iran said that it backed a plan to enrich its uranium in Russia to defuse an international row over its nuclear power programme, but warned against Western attempts to put the debate before the United Nations.

"We positively evaluate this offer. This plan can be perfected during the coming talks in February," top Iranian negotiator Ali Larijani was quoted as saying by RIA Novosti agency in Moscow.

Under the deal, uranium for Iran's nascent nuclear power programme would be enriched in Russia in order to allay Western and Israeli fears that the Islamic republic secretly plans to build a nuclear weapon under cover of the civilian power project.

However, Larijani warned that a US and European push for the International Atomic Energy Agency to refer the controversy over Iran's atomic programme to the UN Security Council would scupper the deal.

"If the matter is referred to the UN Security Council or is used for political pressure Iran will begin industrial enrichment of uranium," he was quoted as saying by ITAR-TASS news agency. - news.yahoo.com

Iran Bomb Blasts Kill Six in Oil-Rich Ahvaz, Hurt 35

Jan. 24 (Bloomberg) -- Two bombs killed at least six people and wounded 35 others in the oil-rich Iranian city of Ahvaz in Khuzestan province, where President Mahmoud Ahmadinejad was due to give a speech today.

Iranian Interior Minister Mostafa Pour Mohammadi said those responsible for the ''terrorist'' acts were trained ''outside'' Iran's borders. One explosion occurred in a bank in Kianpour district in the southwestern city, and the other in Manabe Tabiee, state television said. Ahvaz is near the Iraqi border.

President Ahmadinejad canceled his visit to Ahvaz because of bad weather, his press office said. The bombs didn't explode at the location where he was due to speak, the office said.

Iran holds the world's second-largest oil reserves and is the No. 2 producer in the Organization of Petroleum Exporting Countries. Khuzestan, its largest oil-producing province, has witnessed unrest in recent months that the government attributes to ethnic Arab separatists. Arabs, who make up the majority in Ahvaz, account for 3 percent of Iran's population.

Most of Iran's crude oil reserves are in Khuzestan, which is located close to the border with Iraq and to the Persian Gulf. The province is also home to two of the country's largest undeveloped oil fields -- the Azadegan and Yadavaran deposits.

Iran has given Chinese state oil company China Petroleum & Chemical Corp. a 50 percent stake in the development of the Yadavaran oil field. Inpex Corp., Japan's biggest oil explorer, was awarded a $2 billion contract for the Azadegan oil field in February 2004.

Explosive Devices

Several parcels of explosive devices shipped from abroad have been seized from terrorists, state television quoted Pour- Mohammadi as saying. The Interior Minister called on Iran's parliament to allocate more funds to reinforce the security at the Iran-Iraq border.

In October, four people were killed in two explosions that left 86 injured. Iran at the time accused British agents of detonating the bombs. The U.K. Embassy in Iran rejected the charge.

In early September, a series of bomb blasts in Khuzestan halted crude transfers from onshore wells. In June, one week before the country's presidential election, six people died after a series of explosions in Ahvaz. At least another five died in clashes in April in riots sparked by alleged plans to change the area's ethnic makeup.

Arab Grievances

Arab Iranians ''complain that they have been marginalized by the government in terms of access to development funds, job opportunities and their ability to express their Arab identity and language,'' Control Risks, a London-based company advising businesses on investment hazards, said in an e-mailed note to investors today.

Iranian authorities closed down the Tehran office of Arab television channel Al-Jazeera after the April clashes because of claims its reports had exacerbated the violence.

The eight-year war with Iraq, which ended in 1988, severely affected Iran's oil production, particularly in Khuzestan where much of the fighting took place. As a result, Iran's production capacity has dropped to about 4 million barrels a day currently from 6 million a day in 1974. - bloomberg

Blair Says Iran Claim That U.K. Backed Bombing Is 'Ludicrous'

Jan. 25 (Bloomberg) -- Prime Minister Tony Blair rejected Iranian claims that British soldiers were involved in two bombings that killed at least nine people in the city of Ahvaz, describing the accusation as ''ludicrous.''

''The Iranian government's suggestion that we somehow had a hand in yesterday's bomb explosions in southern Iran is obviously ludicrous and deserves to be treated with scorn by the international community,'' Blair's office said today in a statement read over the telephone.

Iranian Foreign Minister Manouchehr Mottaki said British soldiers equipped and directed the perpetrators of the two bombings, according to a report by the IRNA news agency. He said British forces had provided ''safe haven'' and ''practical and extensive facilities'' for the attacks.

Iran, the world's fourth-biggest oil exporter, may be referred as early as next week by the United Nations nuclear watchdog to the UN Security Council for possible sanctions, following the country's decision this month to resume research on the nuclear fuel cycle.

U.K. Foreign Secretary Jack Straw said on Jan. 16 that Iran is failing to meet its responsibilities to the world over its nuclear program. Iran says the work is for the peaceful purpose of building atomic power plants.

The two bombs that went off yesterday in the oil-rich Iranian city killed at least nine people and wounded 45, the Tehran Times reported. The bombs exploded in the city's commercial center, the newspaper said.

''Putting the blame on us underlines why there is such widespread international concern about this Iranian government,'' said the statement from Blair's office. - bloomberg