"Now is not the crunch time," a European diplomat said, despite the deadlock in which the talks are already mired.

Meanwhile US Secretary of State Condoleezza Rice, seeking to allay European fears of a preemptive US strike on Iran's nuclear sites, said Friday in London that an attack "is simply not on the agenda at this point".

"We have many diplomatic tools still at our disposal and we intend to pursue them fully," Rice said.

Britain, France and Germany struck an agreement with Iran in November to suspend all uranium enrichment-related activities in return for talks on trade, security and technological bonuses for the Islamic Republic.

"The Iranians are going to hold out and bargain for all they can get, and so are the Europeans. It's going to be more costly than either side thought," the diplomat, who asked not to be named, said.

"The crunch time is June, give and take a few months," the diplomat said, referring to the date of presidential elections in Iran.

The diplomat added that the Europeans needed to have the United States join in the talks since trade incentives, such as helping Iran join the World Trade Organization (WTO), were impossible without US backing.

But, said the diplomat, the Americans want to "torpedo the process" since they are convinced the Iranians are secretly developing nuclear weapons and seek confrontation with Tehran rather than accommodation.

A Western diplomat said the Europeans wanted to be able to give Iran "enough near-term incentives to keep the process, and the suspension, going through the Iranian June election."

The Western diplomat said Washington, which wants the UN nuclear watchdog International Atomic Energy Agency (IAEA) to take Iran to the UN Security Council for possible sanctions, "had no definite answer" to the Europeans' request for help.

The Iran-EU talks had begun in Brussels in December, moved to Geneva in January and are to resume Tuesday in Geneva, diplomats said.

Discussions are deadlocked as EU negotiators Britain, France and Germany are now calling on Iran to totally dismantle its nuclear fuel program in order to guarantee it does not seek atomic weapons, according to confidential reports obtained by AFP.

Iran insists its nuclear program is a strictly peaceful effort to generate electric power.

The United States, however, has complained to the EU about centrifuge-related work by Iran that could be used to make nuclear weapons and may violate the uranium enrichment freeze, diplomats said.

Washington's top non-proliferation official, Undersecretary of State John Bolton, wrote on January 28 to the foreign ministry political directors of the European trio about "maintenance" work on centrifuge piping at an enrichment plant at Natanz in southern Iran, the Western diplomat told AFP.

The maintenance work on the centrifuge piping may have been mundane, the diplomat said, but still could be seen as enrichment-related activity since work on centrifuges is banned by the freeze.

Iran refuses to halt uranium enrichment definitively as it insists that the nuclear Non-Proliferation Treaty guarantees its right to such activities when they are peaceful.

A top Iranian cleric warned the government to beware of Britain.

"In reality the English are the father of the Great Satan," Ayatollah Ahmad Janati said during Friday prayers, using the term hardliners employ to describe Iran's arch-enemy the United States.

He said the British were "leaders in being cunning, so we have to be very careful."

In the enrichment process, uranium ore is converted into a gas and then refined in cascades of rapidly spinning centrifuges into what can be fuel for nuclear power reactors but also the explosive core of atomic bombs.

All rights reserved. � 2005 Agence France-Presse. Sections of the information displayed on this page (dispatches, photographs, logos) are protected by intellectual property rights owned by Agence France-Presse. As a consequence, you may not copy, reproduce, modify, transmit, publish, display or in any way commercially exploit any of the content of this section without the prior written consent of Agence France-Presse.