IAEA's Olli Heinonen (l) and Javad Vaeedi, an Iranian negotiator spoke to media last week.
Morteza Nikoubazl/Reuters
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US and Iran spar ahead of Iraq report

The US says it is worried about Iranian support for insurgents in Iraq. Separately, the IAEA reported that Iran's progress on nuclear enrichment is slow.

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Reporter Scott Peterson highlights the latest fiery exchanges between Iran and the US, in part concerning the Iraq war.

Iran says its efforts are peaceful

Iran says it aims only to peacefully produce nuclear power. The US and many in the West believe the civilian program masks a secret weapons effort.

"Iran made a fast start but then there was a leveling off," a senior UN official told Reuters about the enrichment effort. "We don't know the reasons, but the slow pace continues."

US Ambassador to the IAEA Gregory Schulte said Iran's case was far from resolved. "Even if Iran comes clean on the past, its nuclear file cannot be closed until the agency has full insight into the present," he told AFP.

The IAEA reports that Iran is currently enriching uranium at 3.7 percent – far from the nearly 90 percent required for a bomb – and less than the 4.8 percent it has achieved in the past. Any enrichment level under 5 percent is suitable for nuclear fuel.

Iran is also short on its declared aims to install new centrifuges. It has fewer than 2,000 in operation, and several hundred more are being tested or assembled. Two sets of UN Security Council resolutions already target Iran over its decision not to suspend enrichment.

"Ahmadinejad wants to show that he has this foreign policy success and that his robustness has worked," says Ali Ansari, author of "Confronting Iran." "He wants to maintain this mythology that Iran is a great power because it is a nuclear power, and there is this staunch belief that America is an empire in decline … and that Iraq is an indication of this decline."

The result has helped the rhetoric spiral, says Mr. Ansari, an Iran historian at the University of St. Andrews in Scotland.

"Of course, the more you talk about that, the more you raise the hackles on the side of the Americans, who say, 'You think we are in decline? We'll show you how in decline we are …' " adds Ansari. "There are elements in the US, as there are elements in Iran, who are keen to provoke a conflict."

IAEA may 'close files' on Iran

French President Nicolas Sarkozy this week declared the Iranian nuclear issue the worst crisis in the world, and called for more pressure upon Iran to "enable us to escape an alternative that I say is catastrophic: the Iranian bomb or the bombing of Iran."

Ahmadinejad brushed off Mr. Sarkozy's comments, declaring that Iran's cooperation with the IAEA was such that "from our point of view, Iran's nuclear case is closed. Iran is a nuclear nation and has the fuel cycle."

The IAEA has not yet come to that conclusion, though the agreement it struck with Iran spells out a timeline for resolving all issues that have dogged four years of inspections.

From traces of highly enriched uranium (HEU) to centrifuge designs to "alleged studies" of suspicious projects, including plans for a missile reentry vehicle, the IAEA promises to "close files" and revert to "routine" safeguard work, if Iran answers final sets of questions from the IAEA.

"This means that after receiving the questions, no other questions are left," the agreement reads. The IAEA report comes ahead of a meeting Sept. 10 of the IAEA Board of Governors.

The deal has been criticized by nuclear experts. "To date, so many times the IAEA has had discussions with Iran [and] Iran's answers have led to more questions," says Iran expert Mr. Fitzpatrick, speaking before the IAEA report came out Thursday. "It ties up loose ends before you know if there are any loose ends to tie up."

The IAEA sought to ease those concerns Thursday, noting that only more intrusive inspections – which Iran has not permitted for more than a year – could verify the program as peaceful. "The key is that Iran … provides the information that we need," said the IAEA's Mr. Heinonen.

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