updated 3/12/2006 2:13:26 PM ET 2006-03-12T19:13:26

Iran said Sunday it had ruled out a proposal to move its uranium enrichment program to Russia, further complicating the international dispute over the country’s nuclear program.

Russia has sought to persuade Iran to move its enrichment program to Russian territory to allow closer international monitoring. The U.S. and the European Union had backed the idea as a way to ensure Iran would not misuse the process to make nuclear weapons.

Iran had insisted that the plan was negotiable and reached basic agreement with Moscow, but details were never worked out.

“The Russian proposal is not on our agenda any more,” Foreign Ministry spokesman Hamid Reza Asefi told reporters.

Foreign Minister Manouchehr Mottaki, meanwhile, said Iran had no intention to use oil as a weapon in its confrontation with the West over its nuclear program, contradicting comments made a day earlier by the interior minister.

“The Islamic Republic of Iran is insisting to provide Asia with the oil it needs as a reliable and effective source of energy and will not use oil as a foreign policy instrument,” he told a conference on energy and security issues in Tehran.

On Saturday, Interior Minister Mostafa Pourmohammadi warned Iran could use oil as a weapon if the U.N. Security Council imposed sanctions against the country.

Iran is the No. 2 producer in the Organization of Petroleum Exporting Countries after Saudi Arabia. It also has partial control of the narrow Straits of Hormuz, a key route for most of the crude oil shipped from the Persian Gulf nations to world markets.

The five permanent members of the Security Council — the United States, Russia, China, Britain and France — have been considering proposals for pressuring Iran to resolve questions about its nuclear program, including demands that it abandon uranium enrichment.

The council has the power to impose political and economic sanctions.

Asefi said Iran was considering starting large-scale uranium enrichment but would wait for the outcome of the Security Council discussions to make a decision. Iran, however, has only an experimental research program and scientists say it would need months to begin any large-scale enrichment.

Uranium enriched to a low level produces fuel for a nuclear reactor, while higher enrichment produces the material needed for a warhead.

Iran maintains its nuclear program is for generating electricity, but the United States and other Western nations fear Tehran is trying to build a bomb.

Iran restarted research-scale uranium enrichment last month, two years after voluntarily freezing the program during talks with Germany, Britain and France.

Last week, Iran offered to suspend large-scale enrichment temporarily in return for recognition from the U.N.’s International Atomic Energy Agency of its right to continue research-scale enrichment.

The U.S. and its European allies ignored the Iranian offer, insisting that the time had come for the Security Council to handle Iran’s nuclear dossier.

Iran, Russia and the European Unions explored the possibility last week of allowing Iran to resume small-scale enrichment if it re-imposed a freeze for an undefined period to rebuild international trust. But talks broke up without any agreement.

Mottaki warned Sunday that Iran may reconsider its nuclear policy if its right to enrich uranium and produce nuclear fuel is not respected — a veiled threat to withdraw from the Nuclear Nonproliferation Treaty.

“If we reach a point that the existing rules don’t meet the right of the Iranian nation, the Islamic Republic of Iran may reconsider policies,” he said.

In a report last week, IAEA chief Mohamed ElBaradei said Iran was testing centrifuges, which spin uranium gas into enriched uranium, and had plans to begin installing the first 3,000 centrifuges late this year. Iran would need to install about 60,000 centrifuges for large-scale enrichment.

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