The latest report from the International Atomic Energy Agency (IAEA) said it was "plausible" that Tehran was telling the truth in claiming uranium contamination found by IAEA inspectors had come from imported equipment and not because Iranian authorities were enriching uranium as material for an atomic bomb.

The report is likely to make it harder for the United States to succeed in its aim of bringing the Iran nuclear issue to the UN Security Council for possible sanctions.

"Given discussions held up to now, our cooperation with the (IAEA) and the recently published report, I don't think the United States will achieve their objective," Hossein Moussavian, an aide to the head of Iran's nuclear programme, Hassan Rohani, told Iranian state television.

"The (IAEA) can now close the dossier, and if it doesn't, that will be for political reasons," Moussavian added, promising to continue discussions with other countries within the IAEA.

The report, released on Wednesday, also said the IAEA's research into Iran's laser enrichment and uranium conversion activities had confirmed Tehran's reporting on these issues, and that these activities would now only be subject to routine monitoring.

"The more time has passed, the clearer it has become that our nuclear programme and activities are peaceful and do not contravene international rules," asserted foreign ministry spokesman Hamid Reza Asefi.

"This report confirms our expectations," he said. "Some marginal and minor problems remain. We hope that they will be settled in the future."

The IAEA report also signalled Iran was determined to press on with work on the nuclear fuel cycle -- permitted under the nuclear Non-Proliferation Treaty (NPT) despite its potentially dual-use nature.

According to the report, Iran has said it will resume large-scale production of the feed material for enriching uranium. Enriched uranium can be used to provide fuel for reactors as well as nuclear warheads.

But the US administration's top arms control official, undersecretary of state John Bolton, said Washington viewed this "with great concern".

"We view with great concern the IAEA report that Iran is about to convert 37 tons of 'yellowcake' uranium into uranium hexafluoride gas, as well as Iran's recent announcement that it intends to test its gas centrifuges," Bolton said.

Diplomats and analysts may point to a "bigger picture" that points to Iran being on a nuclear weapons drive -- or at the very least seeking an "option" to do so at a later date -- but the IAEA report appeared to be short on the concrete proof needed by the United States in its effort to haul Iran before the Security Council.

Profitting from the divisions at the IAEA, Iran has said it is determined to move at full speed in mastering the nuclear fuel cycle. The Islamic republic insists it is only interested in generating atomic energy and needs to guarantee its own fuel supplies.

Iran in June resumed the assembly and testing of centrifuges, the machines used to enrich uranium, having pledged to suspend enrichment activity to show the world community that its atomic intentions were strictly peaceful.

Wednesday's IAEA report said the Iranians had taken off seals the IAEA had placed to monitor centrifuge manufacture and use at crucial sites.

The report made clear that while Iran has helped the IAEA clarify certain key issues, the investigation would continue.

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