US pushes for sanctions on Iran after deadline passes

Iran and the US are locked even more firmly on a collision course after the United Nations formally declared that Tehran had failed to meet an international deadline to halt uranium enrichment, opening the way for sanctions by the Security Council.

After Iran's latest, studied acts of defiance, including the opening of a heavy water plant at the weekend, yesterday's verdict from the Vienna-based International Atomic Energy Agency (IAEA) was a foregone conclusion. "Iran has not suspended its enrichment-related activities," a report said, nor had Tehran addressed "long outstanding verification issues". Indeed, according to the IAEA, Iran had started a new round of enrichment on 24 August, a week before the deadline.

As the dispute moved towards punitive measures against the Islamic regime, both sides stepped up their rhetoric. In what was billed by the White House as a major national security speech, President Bush placed the nuclear showdown squarely in the context of the "war on terror". "It is time for Iran to make a choice... there must be consequences for Iran's defiance and we must not allow Iran to develop a nuclear weapon," he said.

The response from the Iranian government was equally uncompromising. Although the report was "not fully satisfactory", Mohammed Saeedi, the deputy chief of the country's atomic energy organisation, said, it was enough to show that American "propaganda and politically motivated claims" that its nuclear programme was designed to produce a bomb were "based on hallucinations".

John Bolton, the US ambassador to the UN, yesterday reiterated Washington's position that Iran's refusal to co-operate proved that its nuclear programme was anything but for purely peaceful purposes.

The confrontation seems bound to intensify. Mr Bush will highlight the crisis when he addresses the UN General Assembly on 19 September, by which time some indication is likely of what action will be forthcoming from the Security Council.

But the prospect of severe sanctions is dim. The European Union, which has failed to persuade Tehran to accept a package of incentives to halt enrichment, has broadly lined up behind the US in its condemnation of Iran. But Russia, which has veto powers on the Security Council, was notably vague yesterday, noting merely that the matter should now go before the Council, without delivering a specific verdict on Tehran's response.

Diplomats believe that Russia and China - which also has major economic interests in Iran - are reluctant to endorse sanctions that go beyond minor irritants such as travel restrictions on Iranian officials.

In that case, Mr Bolton warned, the US was prepared to take diplomatic action with the EU and other allies, outside the framework of the Security Council. "Unanimity is not required," he said, referring to the possibility of a veto threat by either Russia or China.

Mohammed Khatami, Iran's former reformist president, is due to visit the US next week.