"The stated objective of Iran is the destruction of Israel," said Bush in a solo White House news conference.

"We've got to work in a collective way with other nations to remind Iran that, you know, they shouldn't develop a nuclear weapon," said Bush.

"It's going to require more than one voice saying that, however. It's going to require a collective effort of the Europeans, for example, to recognize the true threat of an armed Iran to achieving peace in the Middle East."

Iran has denied accusations spearheaded by the United States that it is covertly developing nuclear weapons under the guise of a civilian nuclear program.

Europe has been pressing Tehran to sign an additional protocol to the Non-Proliferation Treaty (NPT) allowing the International Atomic Energy Agency (IAEA) to carry out inspections of its installations without prior notice.

Earlier this month, European Union foreign ministers expressed their "increasing concern" over Iran's nuclear programme and demanded Iran's "unconditional" acceptance of the additional NPT protocol.

The European Union, which is negotiating a key trade pact with Iran, said it would review its cooperation with Tehran after an IAEA report due in September on Iran's nuclear program.

As well as pressuring the European Union, the United States has been trying to convince Russia to stop building Iran's first nuclear power plant near the southern city of Bushehr.

In his news conference Bush said that his frequent warnings to Iran did not presage a slow march towards a military conflict.

"All options remain on the table. I believe that the best way to deal with the Iranians at this point in time is to convince others to join us in a clear declaration that the development of a nuclear weapon is not in their interests," he said.

"I really believe that we can solve this issue peacefully. But this is an issue that's going to require a concerted effort by nations around the world to work with the United States, particularly in Europe, to speak clearly to the Iranian administration."

Bush also called on Iran to hand over suspected al-Qaeda activists it says it is holding, to their countries of origin.

"They've admitted they've got al-Qaeda -- now, that's positive, that the al-Qaeda's not talking to anybody. I mean, I would rather them be held somewhere other than out moving around plotting and planning," he said.

"I would just hope the Iranians would listen to the requests of countries in their neighborhood to turn them over. "

Iran said Monday said that it was "completing the files" on the members al-Qaeda it is holding before deciding on their fate.

"We are studying and completing their files then we will make a decision", foreign ministry spokesman Hamid-Reza Asefi said in a press conference, adding: "As long as their files have not been completed, we can not say anything more."

Tehran admitted for the first time last week that it was holding "prominent" elements of Osama bin Laden's terror network, but did not identify them.

It said it would either extradite them to their country of origin, expel them to where they had come from or prosecute them in Iran.

Among those held in Iran, according to diplomats and the Arab press, are al-Qaeda's Egyptian-born number two and number three Ayman al-Zawahiri and Saif al-Adel, spokesman Sulaiman Abu Ghaith, and one of bin Laden's sons, Saad.

Diplomats say part of the reason for Tehran's reticence has been the fact that many of the detainees have been stripped of their nationalities by Arab governments, complicating the Islamic regime's efforts to negotiate their handover.

They said Iran has been engaged in negotiations with Saudi Arabia, Kuwait and Egypt over the fate of the detainees, but talks with Egypt are complex due to the absence of diplomatic ties.

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