Some optimistic about talks with Iran over nuclear programme

Iran is adamant it will never give up production of nuclear fuel on its own soil.

No one expected a major breakthrough in Istanbul.

An agreement for Iran and major world powers to meet again would be considered a success, western diplomats said. That modest but vital goal seemingly has now been achieved.

It means Iran and the six world powers - the United States, Russia, China, Britain, France and Germany - found enough common ground to explore whether a "win-win" outcome can be achieved.

This will be long and laborious. But the West will require early evidence that Iran is genuinely prepared to address concerns about its nuclear activities and is not filibustering.

Tehran is adamant it will never give up production of nuclear fuel on its own soil.

But it has signalled it could make concessions to alleviate western suspicions that the programme is geared towards achieving a weapons capability.

If so, Iran, which insists its nuclear programme has purely peaceful purposes, will want assurances that the US is not after regime change and is prepared to lift sanctions.

Provided the talks do not collapse, the process would significantly ease tensions over Iran's nuclear programme.

Both sides went to Istanbul determined that some movement was needed to break the increasingly perilous impasse.

Iran faces unprecedented sanctions targeting its economic jugular - oil exports - and the threat of an Israeli military attack.

Barack Obama, the US president, has meanwhile made it clear he does not want the US to be dragged in to another Middle East war that could cause oil prices to soar, damaging the global economy and jeopardising his hopes of a second term in the White House.

Signs of compromise from both sides have emerged in recent weeks. The US said its immediate goal was for Iran to suspend enriching uranium to 20 per cent, which can easily be transformed into bomb-making material, and to transfer abroad its stockpile of that material.

Washington's wish list also includes the closure and eventual dismantling of a hardened, underground facility where most of that activity takes place.

But the West, at least at this stage, is no longer demanding a halt to Iran's enrichment of uranium to 3.5 per cent, the level required to fuel power-generating nuclear reactors.

This could be vital, providing Iran's supreme leader, Ayatollah Ali Khamenei, with a face-saving way out of the crisis. By jettisoning 20 per cent enrichment, Iran would ease the West's immediate fears without any direct pain to its cherished and popular nuclear programme

If acceptance of Iran's enrichment of 3.5 per cent is eventually formalised, Ayatollah Khamenei could boast he has outmanoeuvred the western demands by keeping the heart of that programme intact.

He recently reaffirmed his 1995 religious decree branding nuclear weapons a "grave sin" that were against Islamic principles. That robust public statement intrigued and encouraged Washington, which now wants incontrovertible proof that he means what he says.

Ayatollah Khamenei, Iran's ultimate decision-maker, is deeply suspicious of the West but may not be as inflexible as many analysts maintain.

His domestic room for manoeuvre was also strengthened by last month's parliamentary elections in which his loyalists secured a sweeping victory.

Senior Iranian officials have signalled several times - most recently last week - that Tehran is prepared to relinquish enrichment to 20 per cent. Iran insists it is only purifying to that level for a research reactor producing medical isotopes for cancer patients. So the contours of an eventual deal are visible. Iran would give up its 20 per cent enrichment in return for fuel plates from abroad. Western powers would officially accept 3.5 per cent enrichment if Iran provides verifiable guarantees, including intrusive inspections, that no material is diverted to possible military use.

Iran views uranium enrichment for peaceful nuclear purposes as its inalienable right under the UN's treaty overseeing the spread of nuclear technology. And its leaders have invested much national and personal prestige in the programme they also champion as central to Iran's scientific prowess.

The biggest incentive the West can offer Iran now would be to delay new sanctions set to sever its oil exports to Europe by July and further curtail its ability to conduct international financial transactions.

How far Mr Obama will go in making concessions to Iran in an election year is debatable. But he has been robustly standing up to his hawkish Republican rivals and Israel, recently denouncing their "loose talk of war" over the nuclear standoff. That earned the American president rare praise from Ayatollah Khamenei.

Peter Jenkins, Britain's former ambassador to the UN's nuclear watchdog, said any deal now is likely to be reminiscent of one Iran offered to Britain, France and Germany in 2005. Tehran wanted formal western acceptance of its enrichment to 3.5 per cent and would in turn provide "top notch" safeguards.

Since then, the scale of Iran's uranium enrichment has grown by leaps and bounds. In hindsight, Mr Jenkins added, the Iranian offer should have been "snapped up" seven years ago.