The goal is to use informal contacts with Larijani to get Iran "to come up with some realistic, achievable proposals" to meet the UN's demand for it to suspend uranium enrichment, a European diplomat said in Vienna, where the UN watchdog International Atomic Energy Agency (IAEA) is headquartered.

The crisis is at a clear standoff as Iran rejects the UN Security Council resolution of December 23 which imposed limited sanctions to force it to stop enriching uranium.

The process, which uses centrifuges to make fuel for civilian nuclear power reactors but can also be used to make explosive material for atom bombs, is at the heart of US charges that Iran is hiding work to develop nuclear weapons. Tehran insists its programme is a peaceful one designed to generate electricity.

A diplomat said the best outcome, on the sidelines of the Conference on Security Policy being held in the southern German city of Munich from Friday to Sunday, would be for European Union powers Britain, Germany and France, along with Russia and China to hold a meeting with Iran.

"They might agree on some sort of framework or concept under which the Iranians will pull the plug on centrifuges for a couple of months" -- opening the door to wider talks including the United States -- and for the Security Council to take "no action for that period" on sanctions.

Moscow supports a proposal by IAEA chief Mohamed ElBaradei for a "time-out" in order to encourage further dialogue, under which Iran would suspend uranium enrichment while the United Nations held off on imposing sanctions.

But diplomacy in Munich could be stilled by the long shadow of the United States, and perhaps hardline allies like Britain, which reject such simultaneity and want any Iranian enrichment pause to come first and be unconditional in order to keep Iran from winning additional time to continue strategic fuel work.

US officials have pointed out that once Iran met its commitments to stop such fuel work, the Security Council would suspend its sanctions, as the resolution makes clear.

But diplomats said some European states were at least playing with the idea of a face-saving solution along the lines of a "time-out" that fudges the need for Iran to stand-down first and without conditions.

The Security Council could impose tougher sanctions if a report by ElBaradei later this month shows Tehran continuing to defy the Security Council, especially since Iran is pressing ahead with building an underground plant at Natanz for industrial-level uranium enrichment.

The message in Munich will be "very clear" as the Europeans will urge Larijani to have Iran "re-engage (with the international community). Don't dig yourself deeper in the famous hole," the first diplomat said.

But in a sign the stalemate is not about to end anytime soon, Larijani has ruled out meeting with US officials in Munich.

Like the Davos economic forum, the Munich meeting gathers key world leaders in a framework that favors informal contacts.

New US Defence Secretary Robert Gates will be there as well as Russian President Vladimir Putin, German Chancellor Angela Merkel and European Union foreign policy chief Javier Solana, who led the EU's now stalled talks with Iran.

Non-proliferation analyst Mark Fitzpatrick, of the London think tank the International Institute for Strategic Studies, said: "Iran will be looking for a way to escape further sanctions."

"Larijani might be willing to table again a short suspension that he wanted to table in September talks with Solana but found the hardliners in Tehran opposing," he added.

Since Iranian hardline President Mahmoud Ahmadinejad is "now on the defensive in Tehran, Larijani might have more room to manoeuvre but what he has to offer will likely fall short of the Security Council's resolution for a verified suspension," Fitzpatrick said.

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