Talks in Vienna that seek to end the nuclear deal standoff between Iran and the US will pause for a week as negotiators head home for consultations amid signs of progress.
The EU’s deputy foreign policy chief Enrique Mora said headway had been made since early April, but “much more hard work” was needed.
He said he continued to believe that diplomacy was the "only way forward" to address the challenges.
Iran’s representative Abbas Araghchi said difficulties remained but the meetings were moving forward.
"The Iranian delegation will stop the talks whenever the process of negotiations leads to unreasonable demands, waste of time and irrational bargaining," Iranian state media quoted him as saying.
It is hoped the dialogues in Vienna will pave the way for a return of the US and Iran to compliance with the 2015 nuclear deal that Tehran signed up to with world powers.
Working groups have been established to formulate solutions to both issues.
The EU said a third group was set up on Tuesday “to start looking into the possible sequencing of respective matters.”
Optimism is building that an agreement can be found after the talks between Iran and China, France, Germany, Russia and the UK, the remaining signatories to the accord.
A US delegation was also present in Vienna, but it has not been dealing directly with Iran.
"It was decided to take a break to allow the delegations to do homework and consult with the capitals,” said Russia’s representative Mikhail Ulyanov.
He said the remain signatories of the 2015 deal took note "with satisfaction of the progress in negotiations to restore the nuclear deal".
China's envoy to the UN's nuclear watchdog, Wang Qun, said the lifting of sanctions was the main unresolved issue.
The talks will resume early next week.
US President Joe Biden wants to return to the deal, which his predecessor Donald Trump withdrew from in 2018. Mr Trump also re-imposed heavy sanctions on Iran as part of his policy of "maximum pressure".
In response, Tehran has repeatedly broken the terms of the agreement. It says it will only return to compliance once the US-imposed financial measures are lifted – something Washington insists it will not do until Iran abides by the 2015 accord.
On Monday, a US State Department spokesman said the US team in Vienna "has been exploring concrete approaches concerning the steps both Iran and the US would need to take to return to mutual compliance."
"The discussions have been thorough and thoughtful, if indirect ... There have been no breakthroughs, but we did not expect this process to be easy or quick," he added.
Earlier on Tuesday, the Iranian government said it began enriching uranium to 60 per cent purity to demonstrate its technical ability after a sabotage attack on a nuclear plant in Natanz, to the south of Tehran, but the measure can be reversed if the US lifts sanctions.
Iran blamed the attack on Israel.
Enriching uranium to 60 per cent fissile purity is a major step towards weapons grade from the 20 per cent it achieved some time ago. The 2015 deal capped purity at 3.67 per cent for Iran - suitable for generating civilian nuclear energy.
Tehran has always denied that it is seeking to build an atomic weapon.
"The start of 60 per cent enrichment in Natanz was a demonstration of our technical ability to respond to terrorist sabotage at these facilities," Iranian government spokesman Ali Rabiei told reporters in Tehran.
But he also said the Iranian government assessed "the atmosphere of the Vienna talks as positive.”
“We are cautiously hopeful about an understanding for restoring the nuclear deal, but it is too soon yet to express optimism or pessimism about the final result of the consultations,” he said.