The United States is "just being pragmatic for once, recognizing that the EU3 (Britain, Germany, France) text is pretty good and that there are few good policy alternatives to joining consensus on it," when the UN watchdog International Atomic Energy Agency (IAEA) meets Thursday in Vienna, a Western diplomat said.

Iran said it was freezing its controversial nuclear fuel work Monday in a move welcomed by IAEA chief Mohamed ElBaradei as a step in the right direction to easing fears the Islamic regime is secretly seeking to develop nuclear weapons, as the United States claims.

ElBaradei said the IAEA should be able to verify the uranium enrichment suspension by Thursday, when the agency's 35-nation board of governors is due to decide on the next step in the stand-off.

Uranium enrichment is the key process that makes fuel for nuclear reactors but also what, in highly enriched form, can be the explosive core of atomic bombs.

The United States has for over a year been trying to get the IAEA board to take Iran before the UN Security Council, which can impose punishing sanctions, for hiding sensitive nuclear activities for almost two decades.

But non-aligned states, as well as the European trio and Russia and China, have opposed this, saying that Iran must be given a chance to cooperate with an ongoing IAEA investigation of its nuclear program.

Since the IAEA board adopts most measures by consensus, the United States has been stymied.

The United States is also hindered by furor over its decision to invade Iraq despite having failed to prove Baghdad was hiding weapons of mass destruction, and by the continuing chaos in the country, which borders Iran.

Iran claims its nuclear program is strictly peaceful and has also called for an end to fighting in Iraq.

US President George W. Bush on Monday cautiously welcomed Iran's pledge to freeze all uranium enrichment work, saying "I hope it's true" but insisting on international verification.

Iran, meanwhile, opposes the EU-US agreed draft resolution, objecting to clauses which call on the IAEA investigation to provide "credible assurances regarding the absence of undeclared nuclear material and activities in Iran" and for "unrestricted access" for IAEA inspectors.

A diplomat close to the Iranians said this was going beyond a report on Iran that ElBaradei had filed earlier this month and which said the IAEA had found no undeclared nuclear material in Iran but still could not rule out that there was covert atomic activity.

The resolution says ElBaradei is "to report immediately to the board should the agency encounter evidence that the suspension is not fully implemented, or be prevented from monitoring all elements of the suspension, for as long as the suspension is in force," according to a copy of the text obtained by AFP.

The European trio's draft text also noted "with concern that Iran has continued conversion activities, including the production of UF6 (the feedstock uranium hexafluoride gas used to enrich uranium), in spite of the request made by the (IAEA) board in September" to immediately halt all uranium enrichment activities.

Both these paragraphs were hardened by the United States in EU-US negotiations last weekend, the Western diplomat said.

The United States had wanted the text to include a so-called "trigger mechanism" that would say the matter must go to the UN Security Council if Tehran broke its suspension but the European trio refused this, the diplomat said.

The diplomat said the United States had decided to accept the text since "it meets minimal US needs," especially since Washington "believes that Iran's bad faith will sooner or later (probably sooner) break the suspension agreement."

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