Iran and six world powers begin talks on final nuclear deal

VIENNA (REUTERS) - Six world powers and Iran began talks on Tuesday in pursuit of a final settlement on Tehran's contested nuclear programme in coming months despite caveats from both sides that a breakthrough deal may prove impossible.

Iranian Supreme Leader Ayatollah Ali Khamenei, the man with the final say on all matters of state in the Islamic Republic, declared again on Monday that talks between Tehran and six world powers "will not lead anywhere" - while also reiterating that he did not oppose the delicate diplomacy.

Hours later, a senior US administration official also tamped down expectations, telling reporters in the Austrian capital that it will be a "complicated, difficult and lengthy process" and "probably as likely that we won't get an agreement as it is that we will".

It is the first round of high-level negotiations since a Nov 24 interim deal that, halting a decade-long slide towards outright conflict, has seen Tehran curb some nuclear activities for six months in return for limited relief from sanctions to allow time for a long-term agreement to be hammered out.

The stakes are huge. If successful, the negotiations could help defuse many years of hostility between Iran - an energy-exporting giant - and the West, ease the danger of a new war in the Middle East, transform power relationships in the region and open up vast new possibilities for Western businesses.

The talks - expected to last two or three days - began on Tuesday morning at the United Nations complex in Vienna. The venue was to shift later to a luxury city centre hotel where the chief negotiators were staying.

A spokesman for European Union foreign policy chief Catherine Ashton, overseeing the talks on the powers' behalf, said bilateral meetings between delegations were under way.

Iranian Deputy Foreign Minister Abbas Araqchi sounded upbeat about the initial 40-minute discussions although he appeared to draw a line against Tehran's ballistic missile programme being addressed in any future talks.

"We had good discussions ... and we are trying to set an agenda. If we can agree on an agenda in the next two to three days, it means we have taken the first step.

And we will move forward based on that agenda," he said. "This agenda ... will be about Iran's nuclear programme and nothing else, nothing except Iran's nuclear activities can be discussed."

He was answering a question about Iran's ballistic missile work after US officials said they want Tehran to accept limitations on any nuclear-capable missile technology as part of any long-term deal reached by Iran and the powers.

A spokesman for Ms Ashton confirmed that the current talks aimed only to create "a framework for future negotiations".

Despite his public scepticism about chances for a lasting accord with the West, Mr Khamenei made clear Tehran was committed to continuing the negotiations between Iran and Britain, China, France, Germany, Russia and the United States.

"What our officials started will continue. We will not renege. I have no opposition," he told a crowd in the northern city of Tabriz on Monday to chants of "Death to America" - a standard reflexive refrain since the 1979 Islamic Revolution.

Western diplomats said it was difficult to predict the chances of getting an final agreement with Tehran over the next six months that would be acceptable to all sides.

"The one thing we know is they want the sanctions to go away, which will work in our favour," a Western diplomat told Reuters.

During a decade of fitful dialogue with world powers, Iran has rejected allegations by Western countries that it is seeking a nuclear weapons capability. It says it is enriching uranium only for electricity generation and medical purposes.

Tehran has defied UN Security Council demands that it halt enrichment and other proliferation-sensitive activities, leading to a crippling web of US, EU and UN sanctions that has severely damaged the OPEC country's economy.

Mr Khamenei's approval of serious negotiations with the six powers despite the scepticism he shares with hard-line conservative supporters, diplomats and analysts say, is driven by Iran's worsening economic conditions, analysts say.

Another major factor was the Iranians' overwhelming election last year of a moderate president, Hassan Rouhani, dedicated to relieving Tehran's international isolation.