"They must understand that such an attitude will only persuade us more to have nuclear technology," said top nuclear negotiator Ali Larijani, responding to widespread condemnation of comments by President Mahmoud Ahmadinjad.

Iran has been the focus of an international outcry after Ahmadinejad last week called for Israel to be "wiped off the map". The storm has also raised concerns over the country's bid to master sensitive nuclear fuel technology.

"There won't be a war. They do not have the means to go to war on two fronts," Larijani was quoted as saying by the student news agency ISNA in a reference to the continued hostilities faced by US-led forces in neighbouring Iraq.

"Iran is a hard target," insisted Larijani, who was addressing a seminar on nuclear energy.

"If they think they can limit us by oil sanctions or other sanctions, they are wrong. Oil sanctions will only increase the price of oil," he warned.

Iran says it only wants to develop nuclear power for electricity generation, but the United States and European Union fear Iran is using the fuel cycle as a means to acquire atomic weapons.

Last month, the International Atomic Energy Agency (IAEA) found Iran to be in "non-compliance" with the Non-Proliferation Treaty (NPT) -- paving the way for a Security Council referral.

The IAEA also urged Iran to return to a full suspension of fuel cycle activities which it had agreed to in November 2004, but Iran has so far refused to do so and has rejected an EU offer of trade and other incentives in exchange for a cessation of fuel work.

The next IAEA meeting is on November 24.

"Iran has not concealed anything," Larijani insisted. "We agree that the agency can conduct any kind of inspection to make sure that Iran is not deviating from peaceful nuclear technology."

But he charged that diplomatic efforts to resolve the crisis were being undermined by "a kind of American fascism", adding: "I do not consider negotiations the only way for the nuclear issue, although they are the first priority".

A team of IAEA inspectors is currently in Iran as part of the UN watchdog's two-and-a-half-year-old investigation of its nuclear programme, and another senior Iranian nuclear official said they had made "remarkable progress".

Mohammad Saeedi, the deputy head of Iran's Atomic Energy Organisation, said Iran had recently submitted documents related to P1 and P2 centrifuges -- devices used to enrich uranium to make fuel but which can also be used to make the core of a weapon.

"Some of the documents will be submitted during the inspections," he was quoted as saying, adding the IAEA team would be in the country until Wednesday.

The IAEA's probe has found evidence of suspect activities but no "smoking gun" that proves a weapons drive.

However diplomats at IAEA headquarters in Vienna say the agency still wants more information on Iran's dealings with an international smuggling network run by the now disgraced father of Pakistan's atomic bomb, Abdul Qadeer Khan.

The IAEA also wants more information on centrifuges, as well as access to the Lavizan and Parchin plants where nuclear weapons-related work is suspected.

In addition, the agency was reported to be seeking to clear up questions about possible work in adapting missiles to carry warheads that could be designed to carry nuclear weapons.

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