US allies losing ground on Iran's nuclear advance

WASHINGTON, Apr 13 (Reuters) With every new Iranian advance, hopes dim for keeping Tehran from acquiring nuclear weapons and as the United States and its allies try to delay that day experts and diplomats say they are losing ground.

''We are running out of options,'' one European diplomat who deals with non-proliferation issues told Reuters yesterday. ''The Iranians are producing facts on the ground and we're not responding fast enough.'' A senior Russian official in Washington, who also spoke anonymously because he was not authorized to comment, acknowledged: ''We don't know what to do. Iran is a real headache now.'' Iran has long been moving in this direction, but the announcement on Tuesday that it had produced a first batch of enriched uranium marked another milestone.

If true, it brings Tehran closer to making fuel for nuclear bombs. Experts say actual bomb-making is probably five to 10 years away, although they are not sure.

The enrichment advance triggered condemnations from the world's leading powers, including Russia and China, and US demands that the UN Security Council respond with ''strong steps.'' Available options -- more negotiations and rhetorical pressure, sanctions and military strikes -- have been the same since Iran was found in 2002 to be hiding the extent of its nuclear activities. All present problems.

''What's needed is to change radically Iran's calculations of the costs and benefits'' of pursuing nuclear weapons, said Robert Einhorn, former top U.S. non-proliferation official.

That means ''the Russians and the Chinese being prepared to cooperate in penalties (on Iran) but it also means the United States being prepared to engage directly with Iran and offer the prospect of a more normal relationship with this regime,'' Einhorn, now with the Center for Strategic and International Studies, told Reuters.

But US officials, congressional aides and diplomats said there was no sign the administration is amenable to any dialogue with Tehran beyond proposed talks on Iraq that have yet to occur.

Tehran insists it seeks to produce civilian energy; the West says it is developing weapons.

UN Security Council members said there were no plans to bring forward a meeting set for the end of month to deal with Iran's nuclear ambitions. But there could be moves to accelerate sanctions that some previously predicted would not be attempted until year's end.

Even after Iran's enrichment announcement, sanctions are not assured. Veto-wielding council members Russia and China remain wary although US officials hope both would acquiesce if the UN Security Council took a vote.

The United States imposed sanctions on Iran three decades ago when it severed diplomatic ties after the 1979 Iranian revolution.

It is now working with Gulf states to ensure Iran does not get technology to advance its nuclear program.

A more significant development would be if the European Union, either with the Security Council or on its own, implemented a sanctions package it has drafted, including a travel ban on individuals involved in Iran's nuclear program and controls aimed at ending nuclear cooperation and arms transfers to Iran. Europe is a major Iranian trading partner.

This would only work if all European states participated and it is not clear how many beyond Britain, France and Germany would do so, US and European officials said.

Overshadowing the debate is increased focus on military strikes.

US President George W Bush this week dismissed media reports of planning for such action against Iran as ''wild speculation.'' But US officials and experts told Reuters planning was under way and was prudent given the fact Bush identified Iran as a major threat, although there is little stomach among Americans or US allies for a new war.

Some experts said these reports could help persuade Iran to slow its nuclear development and encourage Russia and China to back sanctions. But others said the reports only scare people who already fear Washington is seeking confrontation.

REUTERS SHR BD0453