Foreign ministry spokesman Mohammad Ali Hosseini said Iran was still seeking to install 3,000 centrifuges by March 2007 at an atomic plant to enrich uranium, a process the West fears could be diverted to make nuclear weapons.

His comments came after a top Israeli official refused to rule out a strike on the Islamic republic to halt the progress of its atomic programme, with the United Nations still unable to agree on sanctions against Tehran.

"Israel does not have the means and the capability to dare threaten Iran... if it commits such a stupidity the Islamic republic and its defenders will give a destructive response within a second," Hosseini said.

Israel -- widely considered to be the Middle East's sole nuclear power -- is within the range of Iran's ballistic missiles and sees Tehran as its chief enemy, pointing to calls from President Mahmoud Ahmadinejad for the Jewish state to be "wiped off the map".

"I am not advocating an Israeli preemptive military action against Iran... I consider it a last resort. But even the last resort is sometimes the only resort," Israeli Deputy Defense Minister Ephraim Sneh said in comments published Friday.

Israeli Prime Minister Ehud Olmert in an interview published Sunday branded Ahmadinejad a "dangerous man", saying "Iran must start to fear" and understand it will "pay dearly" if it does not compromise.

Despite the looming threat of sanctions, Hosseini said that "Iranian officials and experts are seeking" to install 3,000 centrifuges -- reaffirming a target which would allow Iran to enrich uranium on an industrial scale.

He added that the work would take place under the supervision of the UN's nuclear watchdog, the International Atomic Energy Agency (IAEA).

Enriched uranium lies at the center of the dispute over Iran's nuclear program, as it can be used both to make nuclear fuel and the core of a nuclear bomb.

Tehran vehemently rejects US allegations that its nuclear program is aimed at making nuclear weapons, saying the drive is solely aimed at providing energy for civilians.

At present Iran has two cascades of 164 centrifuges on a research level enriching uranium to levels up to five percent -- rich enough for nuclear fuel but way off the 90 percent levels required for a nuclear bomb.

Major powers at the UN Security Council are mulling a resolution that would impose sanctions on Iran after it refused to suspend enrichment in return for an international offer of incentives.

The Security Council's five permanent members -- Britain, China, France, Russia and the United States -- plus Germany will resume talks Monday on how to censure a defiant Iran.

Ahmadinejad on Sunday called the UN Security Council "incompetent, and pressured by domineering powers".

"It is disgraceful that the UN Security Council, which must defend countries' rights and interests, threatens and makes a dossier against the states that are legally seeking nuclear fuel," he said on state television.

World powers will be discussing a European-proposed draft resolution mandating nuclear industry and ballistic missile-related sanctions against Iran.

But Russia and China, which have major energy and trade ties with Tehran, view the European draft as too tough and unlikely to bring about Iranian cooperation.

The sanctions would also include travel bans and financial restrictions on Iranian scientists working on the country's nuclear and missile programs.

The US has been pushing for even tougher sanctions but Russia, which is building Iran's first nuclear power plant in Bushehr, has proposed amendments that would tone down the punitive measures.

Monday's meeting follows top Iranian nuclear negotiator Ali Larijani's two days of talks with Russian leaders in Moscow on the Iranian nuclear issue.

Larijani warned Friday that Iran would review its relations with the IAEA if the UN adopted the European resolution without the amendments proposed by Russia.

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