msnbc.com news services
updated 1/26/2012 11:44:52 AM ET 2012-01-26T16:44:52

Updated 11:35 a.m.ET: Iran says European countries will be the losers from the EU's oil sanctions, imposed earlier this week. "It is the West that needs Iran and the Iranian nation will not lose from the sanctions," President Ahmadinejad said in his first public comments on the issue since the EU's 27 member states agreed to the ban on Monday. EU countries comprise 10 percent of the market for Iranian oil. Although the EU believes resurgent production from Libya will eventually replace the oil currently supplied by Iran, some economists fear there could be significant price rises in the short term, harming already fragile European economies.

Published 8:13 a.m.ET: President Mahmoud Ahmadinejad said Thursday that Iran was ready for nuclear talks with the world powers amid toughening sanctions aimed at forcing Tehran to sharply scale back its nuclear program.

Ahmadinejad, however, said sanctions would not force Iran to capitulate to Western demands.

The United States and allies want Iran to halt uranium enrichment, which they worry could lead to weapons-grade material. Iran says it only seeks reactors for energy and research.

Ahmadinejad made the remarks in Kerman, southeastern Iran.

Video: Israeli finance minister: Sanctions against Iran significant but partial (on this page)

Iran had previously indicated that it is ready for a new round of talks with the five permanent Security Council members plus Germany.

U.N. nuclear team
A senior U.N. nuclear agency team is expected to visit Tehran at the weekend.

How Tehran deals with the International Atomic Energy Agency may offer pointers to prospects for resolving a long-running dispute that an oil embargo and threats of war, along with talk of Iran closing in on nuclear weapons capability and the U.S. presidential election calendar, have escalated to crisis level.

Video: Ignatius: Iran sending signals they want to come to table (on this page)

The outcome of the inspectors' meetings from Sunday to Tuesday will be closely watched in Washington, European capitals and Israel for signs of whether Iran's leadership may finally be prepared to give ground after a decade of pursuing its nuclear development goals or whether it remains as defiant as ever.

Slideshow: Everyday life in Iran (on this page)

"I hope that, at a minimum, the parties can agree on how to proceed in resolving outstanding issues, and that also includes the military dimension of Iran's nuclear program," said Olli Heinonen, a former chief U.N. safeguards inspector.

U.S.-made fighter crashes
Meanwhile, Iran's semi-official Fars news agency said a U.S.-made F-14 Iranian fighter jet crashed in Bushehr province in southern Iran Thursday.

Provincial governor Mohammad Hossein Jahanbakhsh said both the pilot and the co-pilot were killed in Thursday's crash.

Danger zone then and now: Strait of Hormuz

The Fars report said the fighter plane crashed due to technical failure and that authorities had recovered the wreckage outside Bushehr, a port city with the same name as the province.

Bushehr is known as the location of Iran's first nuclear power plant.

Iran purchased many U.S.-made planes, including F-14s before the 1979 Islamic Revolution and during the rule of the late pro-Western Shah Mohammad Reza Pahlavi.

The Associated Press and Reuters contributed to this report.

Photos: Slices of life in Iran

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  1. A student learns how to play a musical instrument at Pishtaz School in Tehran on October 15, 2011. Pishtaz, the first computerised pre-school for gifted students in Iran, claims to have pioneered teaching techniques through the means of IT. Parents can watch their children's daily activities from home via CCTV cameras installed throughout the public areas in the school, which includes the classrooms, playgrounds and hallways. (Raheb Homavandi / Reuters) Back to slideshow navigation
  2. Local Baluch fishermen push a boat to the shore at a fishing port in Tiss village in the suburb of the port city of Chabahar, 902 miles southeast of Tehran, near the Strait of Hormuz on January 16, 2012. (Raheb Homavandi / Reuters) Back to slideshow navigation
  3. Dog lover Neda plays with the strays at the Vafa animal shelter in the town of Hashtgerd, about 45 miles west of the capital Tehran on June 30, 2011. The first animal shelter in Iran, the non-government charity relies on private donations and volunteers to provide shelter to injured and homeless dogs in Iran. Canine lovers in the Islamic Republic are faced with a motion put forth by lawmakers in the conservative-dominated to ban the public appearance of dogs due to their "uncleanness" and to combat "a blind imitation of vulgar Western culture." If the motion becomes law, first-time offenders will be fined five million rials (472 USD or 337 euros) and will be given a 10-day period to get rid of the dog or face the canine's confiscation to an unknown fate. (Behrouz Mehri / AFP - Getty Images) Back to slideshow navigation
  4. University students cross a street during a snow storm in Tehran onNovember 8, 2010. A rare autumn snow blanketed much of northern Iran closing roads and schools in mountainous regions. (Caren Firouz / Reuters) Back to slideshow navigation
  5. Iranian women and a man weave carpet in a workshop in Qom, 78 miles south of the capital Tehran. Deep in Tehran's carpet bazaar, the merchants and laborers occupy chambers that have changed little over the centuries. But Iran's carpet industry now faces some modern pressures. The country's more than 1 million weavers _ producing an average of $500 million in exports a year _ are fighting against competitors in major workshops in places such as Pakistan and China. (Vahid Salemi / AP) Back to slideshow navigation
  6. The hand of a worker at a carpet workshop in Qom. (Morteza Nikoubazl / Reuters) Back to slideshow navigation
  7. Coffee mugs bearing pictures of the late Apple co-founder Steve Jobs are displayed for sale as a man works on a MacBook at a shop in Payetakht (Capital) computer centre in northern Tehran on January 19, 2012. (Morteza Nikoubazl / Reuters) Back to slideshow navigation
  8. Actors take part in a re-enactment of the 7th century battle of Kerbala during the "Taziyeh" religious theatre performance on Tasoua, a day before Ashura, in Noushabad, Isfahan province on December 5, 2011. Ashura, the most important day in the Shi'ite Muslim calendar, commemorates the death of Imam Hussein, grandson of the Prophet Mohammad, in the 7th century battle of Kerbala. (Raheb Homavandi / Reuters) Back to slideshow navigation
  9. An Iranian-Christian woman looks at Christmas decorations while shopping in central Tehran on December 13, 2011. (Morteza Nikoubazl / Reuters) Back to slideshow navigation
  10. Iranian Jewish men pray during Hanukkah celebrations at the Yousefabad Synagogue, in Tehran, Iran on Dec. 27, 2011. (Vahid Salemi / AP) Back to slideshow navigation
  11. A man leaves after shopping at a fruit store in Tehran on January 6, 2012. International sanctions aimed at depriving Iran's nuclear programme of funds and technology are squeezing Tehran's vital oil exports and government finances. In September 2010 the government pushed through cuts in fuel subsidies despite public and parliamentary opposition. Rising utility prices have since forced factories to shut - an estimated 180 in Tehran alone. Prices of basic goods like bread, meat and rice are increasing daily. Meat is too expensive for many, costing $20 a kilo. Iranian opposition websites regularly issue reports of layoffs and strikes by workers who haven't been paid for months, including in government-owned factories. (Raheb Homavandi / Reuters) Back to slideshow navigation
  12. A cleric waits for the start of a conference titled "Gaza, a Symbol of Resistance" in Tehran on January 18, 2012. (Caren Firouz / Reuters) Back to slideshow navigation
  13. Iranian woman Mahnaz Mollaei, right, teaches rollerblading to a girl at the Pardis club, in the central city of Isfahan, 234 miles south of the capital Tehran, Iran on Jan. 1, 2012. (Vahid Salemi / AP) Back to slideshow navigation
  14. A woman makes a purchase at a store in Tehran on January 6, 2012. (Raheb Homavandi / Reuters) Back to slideshow navigation
  15. A street money exchanger, puts US dollars in a plastic bag, in Ferdowsi St. in downtown Tehran, Iran, Wednesday on Dec. 21, 2011. The rial hit a record low on Wednesday, with the US dollar selling for 16,150 rials in foreign currency exchange offices. The dollar sold for about 10,500 rials last December and in 1979 _ the year an Islamic revolution toppled the pro-Western Shah Mohammad Reza Pahlavi _ it was 70 rials against the dollar. Iran has restricted cash withdrawals and allows banks to sell only $2,000 per year to each person traveling outside the country. (Vahid Salemi / AP) Back to slideshow navigation
  16. Shoe repairman, Aziz, 86, works in a street in downtown Tehran in November 2010. The most potent challenge to Iran's ruling system may not be international sanctions or the homegrown political opposition, but something as simple as a shopping list. Islamic leaders are starting to trim an estimated $100 billion a year in government subsidies for fuel and food staples that many low-income Iranians consider a birthright. (Vahid Salemi / AP) Back to slideshow navigation
  17. A jockey competes during the summer races at the Norouzabad Equestrian center on the outskirts of Tehran on September 16, 2011. (Caren Firouz / Reuters) Back to slideshow navigation
  18. Spectators cheer as the horses run during the summer races at the Norouzabad Equestrian center on the outskirts of Tehran on September 16, 2011. Under Islamic sharia law, gambling is generally seen as illegal. But thanks to certain religious rulings, many race-goers are permitted to put money on the horses legally as long as they are "predicting" through official channels. (Caren Firouz / Reuters) Back to slideshow navigation
  19. An unidentified Iranian vendor wait for customer to sell flags of two Iranian giant soccer teams Esteghlal, left, and Persepolis, right, prior to start of their 73rd derby match, during Iran's Jam-e-Hazfi, or Elimination Cup, at the Azadi (Freedom) stadium in Tehran, Iran, on Dec. 9, 2011. Iran's top two soccer teams fought in a quarter final match of the cup and Esteghlal won 3-0. (Vahid Salemi / AP) Back to slideshow navigation
  20. Ghazaleh Miramini, left, practices guitar with her music teacher Amir Salami at a music school in Tehran on Nov. 3, 2011. In the 1980s, Iran's music almost vanished. Music schools went into full recession, police or militias stopped cars to check what passengers were listening to and broke tapes playing pre-revolutionary singers, and clerical institutions even banned music as un-Islamic. But Iran's social life has dramatically changed a decade later, with a landslide victory of former President Mohammad Khatami with relaxing some of rigid restrictions on cultural and social activities, including bans on music bands, but Iran has tightened censorship of books, films, and music since President Mahmoud Ahmadinejad came to power. (Str / AP) Back to slideshow navigation
  21. Amin Gholami, right, dances in Azeri-style as Aydin Kanani plays a Gaval, a large-sized tambourine, in the Gharadagh mountainous area in northwestern Iran on Oct. 26, 2011. (Str / AP) Back to slideshow navigation
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Video: Israeli finance minister: Sanctions against Iran significant but partial

  1. Closed captioning of: Israeli finance minister: Sanctions against Iran significant but partial

    >>> israeli minister of financial. very good to have you with us.

    >> good morning.

    >> we want to talk about finance, but let's talk about iran first. obviously in america that's what so president of our presidential candidates are obsessed with. dr. brzezinski here, a great picture. does iran overshadow just about everything that goes on in israel right now as far as foreign policy goes?

    >> this is a little bit too much, about you of course the gravity of the iranian threat, and not just to israel and the middle east , about you to europe and --

    >> would you call it an existential threat when ahmadinejad says he wants to destroy israel orb do you dismiss him as a clown?

    >> no. many people in the world dismissed hitler as a clown. we know this is serious. and the gravity of the iran nuclear threat is of enormous magnitude. it's also to the western world all together, to the free western world . i would put it like this -- since italy and since russia during the cold war , this is the most potential threat to the peace of the world together.

    >> since 1948 for israel , the greatest threat since that time?

    >> i cannot say this is the greatest threat --

    >> come on, make a sweeping statement. come on.

    >> it's a real threat, and i want to emphasize it's not just a threat to israel . if a threat to the entire middle east , it's a threat to europe , as you probably know, the iranian missiles can now reach most of europe , and now they're waiting on enter continental ballistic missiles . so it's not just israel that is under the threat here.

    >> prime minister netanyahu just yesterday praised the new tougher sanctions imposed on iran . do you think they go far enough?

    >> first, i put it like this. it's very important that finally, finally the europeans like the americans are putting almost an economic blockade on the iranians, yet it's very significant, but the gravity of the threat might make it insufficient yet. if the world wants to prevent this -- the realization of the threat, they should come under a complete economic blockade in order to force them not to proceed. of course all the options should remain on the table. i'm very happy both america and israel are making it very clear that all the options are on the table if necessary. what more specifically would you like to see done?

    >> those are very significant, but still partial.

    >> what more can be done?

    >> a complete economic blockade. also a sea blockade on the iranians. you know, it should be prevented. the world will be different and much more dangerous world if those iranian get nuclear weapons with long-range missiles. already berlin and -- and they were working currently, on i mentioned before, intercontinental ballistic missiles .

    >> so let's move from military threats to economic threat. how much a threat is the european crisis economically on israel ?

    >> like the rest of the world , we are concerned. you know, 50% of israeli gdp, or export is like 50% of the gdp, and much of it is going to europe . if europe is declining, the impact on israel might be immediate.

    >> and yet you had a record sale of israeli bonds over the weekend. what is it that foreign investors see in israel that they like?

    >> well, first, in the last two years, the israeli economy is really growing, the fastest-growing economy in the western world . and it's mainly not due to a shopping -- the volume of economic activity , but due to new investments in the real economy in the country. the level of investing current will i in israel is 75 march beyond the b.r.i.i.c. crisis in investments. which is extremely significant. part of it, we are the first nation to implement a two-year budget in the middle of the crisis. this was extremely helpful to stabilize the system during the crisis, and part of it because we gave many incentives for investors to invest in the israeli economy in the economile of the crisis. we are putting a lot of emphasis on improving all the infrastructure, including dramatically improving the higher education in israel , in order to continue to produce very strong human capital , which is the secret of the success of the israeli economy .

    >>> when stan signor wrote about in "start upnation." he's a great guy to make bets with. he always loses. anyway, "start-up nation" and it sounds like the rest of the world is agreeing with stan.

    >>> thank you for being on the show this morning.

    >> my pleasure.

    >>> more " morning joe " in just a minute. brad, where we going? just a second. just,

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