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TOKYO, May 1 (Reuters) - Gold extended its gains on Monday after powering to a fresh 25-year high in New York as mounting tension over Iran's nuclear programme induced buying of the metal for safe-haven purposes.

Sentiment was bullish as near-record prices for oil and base metals, along with a sharp fall in the dollar against the euro, fueled aggressive investor buying in gold.

''Gold is in a strong uptrend. The biggest factor now is growing geopolitical tensions because of Iran,'' said Shuji Sugata, assistant manager at Mitsubishi Corp Futures and Securities Ltd.

''It's important that gold broke through $650, but the rise was a bit too quick,'' Sugata said.

As of 0230 GMT, spot gold was trading at $654.50/655.50 an ounce, compared with $651.80/652.80 in New York on Friday where it rose as high as $655.30, which was the highest since 1980.

Geopolitical tensions are growing after the International Atomic Energy Agency reported Iran had ignored a call to halt nuclear activities and accelerated its uranium enrichment programme.

U.N. ambassadors from the United States, Britain and France are expected to introduce a resolution this week to legally oblige Iran to comply with the council's demands.

Gold was supported by a weaker dollar on Monday, which dropped to a three-month low against the yen and hovered near a one-year low against the euro.

A weak dollar makes gold cheaper for holders of other currencies and boosts demand.

Tokyo Commodity Exchange gold futures rose about 2 percent, but a higher yen slowed their gains. A stronger yen effectively lowers the value of yen-based gold.

The benchmark April 2007 TOCOM gold contract closed the morning session at 2,427 yen per gram, up 48 yen or 2.02 percent from Friday.

Still, precious metals markets lack energy as markets in Singapore and Hong Kong are closed, while those in London and many other European countries will also be closed for a national holiday.

''Tokyo gold prices are slightly underperforming due to a higher yen, but they will follow the overall strength in the dollar-based prices,'' Sugata said.

Silver was trading at $13.70/13.90 per ounce, up from $13.60/13.70 in New York on Friday.

Barclays Global Investors' new exchange traded fund, called iShares Silver Trust, began trading on the American Stock Exchange on Friday under the symbol SLV.

Platinum edged up to $1,153/1,163 an ounce, compared with $1,152/1,156 in New York.

Palladium was little changed at $370/380 an ounce against $370/375 in New York.

REUTERS MP KN1707