A senior Iranian envoy abruptly cancelled talks today with the head of the International Atomic Energy Agency, dashing hopes that Tehran is ready to end its secrecy about past nuclear activities that could be part of a weapons programme.
Diplomats familiar with the issue said the change in plans was dictated by hard-liners associated with President Mahmoud Ahmadinejad and opposed to concessions in the nuclear dispute that has led to two sets of UN Security Council sanctions against Tehran.
The meeting, between Javeed Vaidi of Iran and IAEA director general Mohamed ElBaradei, had been billed as a test of Tehran's readiness to end years of stonewalling on past suspicious nuclear activities.
But the talks were cancelled on short notice because of perceptions that Vaidi would bring "nothing substantial" to that meeting, a diplomat said.
Another diplomat said the Iranians pulled out on orders of the camp linked to Ahmadinejad. The diplomat, who demanded anonymity because his information was confidential, said Vaidi had been apparently prepared to offer concrete proposals to ElBaradei and his aides before being told to opt out.
Ahmadinejad has been outspoken on Iran's right to enrich uranium for power generation, despite two sets of UN sanctions bred by suspicions the programme could be used to produce fissionable material for weapons.
Again rejecting UN demands for an enrichment freeze, Ahmadinejad last week said any Western attempt to force a halt would be like playing "with the lion's tail".
In Vienna, Vaidi did talk with EU negotiator Robert Cooper. Both men spoke of "some progress" but warned against expectations of "miracles".
Still, the cancellation of subsequent meetings with ElBaradei and aides dashed hopes that Iran was prepared for a breakthrough compromise on one of the issues that led to its referral last year to the Security Council.
It was also likely to give support to Iran critics at a meeting of the Vienna-based IAEA's 35-nation board that opened today. Gregory Schulte, the chief US delegate to the gathering, set the tone for countries pushing Iran.
"Iran's leaders (are) continuing to develop capabilities to enrich uranium and produce plutonium," Schulte told reporters. "These capabilities are not necessary to benefit peaceful nuclear technology but are necessary to produce fissile material for nuclear weapons."
He took Tehran to task for "continuing to withdraw cooperation from the IAEA, causing a troubling deterioration of the agency's knowledge of Iran's nuclear capabilities".
The Vaidi-Cooper talks were a follow-up to May 31 discussions in Madrid between EU foreign policy chief Javier Solana and Ali Larijani, Vaidi's superior and Iran's chief nuclear negotiator.
That meeting ended with Iran offering to divulge information long sought by IAEA experts trying to establish whether Tehran's past nuclear activists were secretly aimed at trying to make weapons.
The offer fell short of the talks' main purpose - finding a way to bridge an impasse over Iran's rejection of UN Security Council demands that it suspend uranium enrichment.
Still, any decision by Iran to fully cooperate on clearing up questions would have represented a major concession - a hope diminished with news that the Vaidi-ElBaradei meeting had been cancelled.
An IAEA report two weeks ago provided the potential trigger for new UN sanctions, saying Iran continued to defy the Security Council and was instead expanding its enrichment activities.
The report was also critical of Iran's refusal to answer questions about nearly two decades of clandestine nuclear activities that first came to light four years ago.
The concerns include: traces of enriched uranium at a facility linked to the military, which could be a sign of a weapons programme; lack of documentation on Iran's past enrichment activities, and possession of documents showing how to form uranium metal into the form of missile warheads.
Along with Iran's refusal to freeze uranium enrichment and restrictions on IAEA inspectors, Tehran's stonewalling was also the focus of ElBaradei, in opening comments to the board meeting.
The agency is unable "to make any progress in its efforts to resolve outstanding issues relevant to the nature and scope of Iran's nuclear programme," ElBaradei said, describing the setback as a "key proliferation concern."
"It is incumbent on Iran to work urgently with the agency ... in order for the agency to be able to provide assurance regarding the exclusively peaceful nature of all of Iran's nuclear activities," ElBaradei said.