"The situation is moving towards escalation and confrontation in the region," Sheikh Mohammed Sabah al-Salem al-Sabah told the pan-Arab daily Al-Hayat newspaper.

The UN Security Council has imposed two packages of sanctions against Iran over its failure to heed international ultimatums calling on it to suspend its uranium enrichment programme.

The latest resolution placed a "timeline of escalation against Tehran," Sheikh Mohammed said, adding that he feared "what happened to Saddam Hussein might happen to the Iranians."

The United States fears Iran is secretly developing an atomic weapon, a charge Tehran strongly denies.

Sheikh Mohammed said he met his Iranian counterpart Manouchehr Mottaki at a meeting of Arab leaders in Saudi Arabia last month and urged him to "work with wisdom, with lawful international decisions."

Gulf Arab states neighbouring Iran are close allies of the United States and fear being dragged into a military conflict if concerns over the Islamic republic's nuclear ambitions are not resolved peacefully.

Iran on Sunday reiterated that any suspension of sensitive nuclear activities was not open to discussion, the day before President Mahmoud Ahmadinejad is expected to announce a major development in its atomic project.

"We will not discuss the legitimate rights of Iran," foreign ministry spokesman Mohammad Ali Hosseini told a news conference in Tehran.

Ahmadinejad on Monday is due to visit the uranium enrichment facility in Natanz -- Iran's most sensitive nuclear site -- to mark the Islamic republic's day of nuclear technology.

He is expected to make a major announcement after repeatedly promising "good news" about Iran's nuclear programme in the near future.

Iran has said it wants to install 3,000 uranium-enriching centrifuges at Natanz, and observers are expecting the announcement to refer to progress in the enrichment process.

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