(Repeating, no changes to copy)
* U.N.-Iran talks collapse
* Oil prices rise on fears of confrontation with West
* U.S. criticises Iran over talks failure
* Iranian leader expresses defiance
VIENNA/TEHRAN Feb 23 (Reuters) - The U.N. nuclear
watchdog's latest mission to Iran failed to budge a defiant
Tehran over its disputed nuclear programme, sending oil prices
to a nine-month high over fears of an increasing risk of
confrontation with the West.
The United States criticised Iran on Wednesday over the
collapse of the International Atomic Energy Agency's talks in
Tehran, saying it again showed the Islamic Republic's refusal to
abide by international obligations over its nuclear programme.
Expressing defiance, Supreme Leader Ayatollah Ali Khamenei
said Iran's nuclear policies would not change despite mounting
international pressure against what the West says are Tehran's
plans to obtain nuclear bombs.
"With God's help, and without paying attention to
propaganda, Iran's nuclear course should continue firmly and
seriously," he said on state TV. "Pressures, sanctions and
assassinations will bear no fruit. No obstacles can stop Iran's
nuclear work."
A team from the Vienna-based IAEA had hoped to inspect a
site at Parchin, southeast of Tehran, where the agency believes
there is a facility to test explosives. But the IAEA said Iran
"did not grant permission".
The failure of the two-day IAEA visit could hamper any
resumption of wider nuclear negotiations between Iran and six
world powers - the United States, China, Russia, Britain, France
and Germany - as the sense grows that Tehran feels it is being
backed into a corner.
The standoff has rattled oil markets. On Wednesday,
London-traded benchmark Brent crude for April delivery rose for
a third day - up $1.24 a barrel at $122.90, a nine-month high.
U.S. crude futures for April were up 3 cents at $106.28 a
barrel.
In Washington, White House spokesman Jay Carney said the
United States was evaluating Iran's intentions.
"This particular action (over the IAEA mission) by Iran
suggests that they have not changed their behaviour when it
comes to abiding by their international obligations," Carney
told reporters.
Iran rejects accusations that its nuclear programme is a
covert bid to develop a nuclear weapons capability, saying it is
seeking to produce only electricity.
As Western sanctions mount, ordinary Iranians are suffering
from the effects of soaring prices and a collapsing currency.
Several Iranian nuclear scientists have been killed over the
past two years in bomb attacks that Tehran has blamed on its
arch-adversary Israel.
Major oil importer Japan was in final talks with Washington
on an agreement for cuts in Iranian crude oil imports that could
amount to a higher-than-expected 20 percent or more a year, a
newspaper reported on Thursday.
China, India and Japan, the top three buyers of Iranian oil,
are all planning cuts of at least 10 percent. They buy about 45
percent of Tehran's crude exports.
IRAN'S DEFIANT STANCE
In response to Western pressure and sanctions, Iran has
issued a series of statements asserting its right to
self-defence and threatening to block the Strait of Hormuz, a
vital oil tanker route.
The collapse of the nuclear talks occurred as Iran seems
increasingly isolated, with some experts seeing Tehran's
defiance in response to sanctions against its oil industry and
financial institutions as evidence that it is in no mood to
compromise with the West.
Parliamentary elections on March 2 are expected to be won by
supporters of Khamenei, an implacable enemy of the West.
The United States and Israel have not ruled out using force
against Iran if they conclude that diplomacy and sanctions will
not stop it from developing a nuclear bomb.
In Jerusalem, Israel's Foreign Minister Avigdor Lieberman
dismissed appeals by world powers to avoid any pre-emptive
attacks against Iran's nuclear programme.
Lieberman said that "with all due respect I have for the
United states and Russia, it's none of their business. The
security of Israel and its residents, Israel's future, is the
responsibility of Israel's government."
The failure of the IAEA's mission may increase the chances
of a strike by Israel on Iran, some analysts say.
But this would be "catastrophic for the region and for the
whole system of international relations," Russian Deputy Foreign
Minister Gennady Gatilov said.
Referring to Iran's role in the failure of the IAEA mission,
French Deputy Foreign Ministry spokesman Romain Nadal said: "It
is another missed opportunity. This refusal to cooperate adds to
the recent statements made by Iranian officials welcoming the
progress of their nuclear activities."
In the view of some analysts, the Iranians may be trying to
keep their opponents guessing as to their capabilities, a
diplomatic strategy that has served them well in the past.
"But they may be overdoing the smoke and mirrors and as a
result leaving themselves more vulnerable," said professor
Rosemary Hollis of London's City University.
Iranian analyst Mohammad Marandi said providing the West
with any more access than necessary to nuclear sites would be a
sign of weakness.
"Under the current conditions it is not in Iran's interest
to cooperate more than is necessary because the West is waging a
war against the Iranian nation," he told Reuters.
IAEA "DISAPPOINTED" OVER OUTCOME
Earlier, Iran's envoy to the IAEA, Ali Asghar Soltanieh,
said Tehran expected to hold more talks with the U.N. agency,
but IAEA Director General Yukiya Amano's spokeswoman said no
further meetings were planned.
"During both the first and second round of discussions, the
agency team requested access to the military site at Parchin.
Iran did not grant permission for this visit to take place," the
IAEA said in a statement.
"It is disappointing that Iran did not accept our request to
visit Parchin. We engaged in a constructive spirit, but no
agreement was reached," Amano said.
A Western official, who declined to be identified, said: "We
think that if Iran has nothing to hide, why do they behave in
that way?"
Iran's refusal to curb sensitive atomic activities which can
have both civilian and military purposes and its record of years
of nuclear secrecy have drawn increasingly tough U.N. and
separate U.S. and European measures.
An IAEA report in November suggested Iran had pursued
military nuclear technology. It helped precipitate the latest
sanctions by the European Union and United States.
(Editing By Ralph Gowling)
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