Iran accused of being leading terror sponsor

President George Bush stood on the shores of the United Arab Emirates and delivered a strong message across the waters of the Gulf to Iran. He accused Tehran of being "the world's leading state sponsor of terror" and urged regional allies to confront the "danger" posed by Iran "before it is too late".

In a speech in Abu Dhabi devoted to his creed of the benefits of spreading democracy, the US President said that "violent extremists" who had "hijacked" Islam to undermine freedom and democracy were financed and supported by Iran. "It sends hundreds of millions of dollars to extremists around the world – while its own people face repression and economic hardship," he said.

The President repeated charges that Iran was subverting peace hopes by funding and aiding Islamic militants in Lebanon, Gaza, Iraq and Afghanistan. Iran's actions "threaten the security of nations everywhere," he went on, noting that Iran had still failed to totally account for its nuclear programmes to UN inspectors.

The International Atomic Energy Agency said yesterday after talks in Tehran that Iran had agreed to clear up outstanding questions within a month, although the Iranian government is still refusing to yield to UN demands that it halt uranium enrichment, the key process that can lead to production of a nuclear weapon. Iran says its intentions are purely peaceful.

Referring to a multibillion-dollar package for the Gulf states and Egypt to act as a counterweight to Iran, Mr Bush said that "the United States is strengthening our longstanding security commitments with our friends in the Gulf – and rallying friends around the world to confront this danger before it is too late."

He also addressed the people of Iran directly, saying that "the day will come when the people of Iran have a government that embraces liberty and justice", and when that day comes "you will have no better friend that the United States of America".

Mr Bush's tough stance on Iran was undermined by the conclusions of a National Intelligence Estimate which stated that Tehran had stopped its nuclear weapons programme in 2003. But last week's confrontation in the Strait of Hormuz between US Navy ships and Iranian Revolutionary Guards raised concerns in the Gulf that President Bush may still envisage military strikes against Iran before he leaves office.

Des Browne, the British Defence Secretary, asked about the British position by The Independent, said: "We are 100 per cent focused on a diplomatic resolution to this issue."

A senior Omani official told The Independent that the Gulf states had no problem with states obtaining nuclear power under UN supervision, and that Oman, which overlooks the Strait of Hormuz, did not see its neighbour Iran as a threat.

President Nicolas Sarkozy of France arrived in Riyadh last night on his own Gulf tour.