"Iran is likely to be cautious. They want to get through the November 24 board" of governors' meeting of the UN watchdog International Atomic Energy Agency (IAEA), non-proliferation expert Gary Samore told AFP.

In a resolution on September 24, the Vienna-based IAEA threatened to refer Tehran to the UN Security Council over its nuclear program, which the United States claims is a cover for weapons development, but this is not expected to happen before the November board meeting.

The United States on Monday urged all countries to freeze nuclear cooperation with Iran but Russia, which has a lucrative contract to build the Islamic Republic's first nuclear power plant, was not expected to heed this call.

The IAEA resolution, drafted by EU states Britain, France and Germany, cites Iran for having resumed nuclear fuel cycle work it had voluntarily suspended to show its nuclear intentions were peaceful.

The IAEA also accused Iran of hiding sensitive atomic activities in violation of the nuclear Non-Proliferation Treaty (NPT).

Iran's first reaction was a threat to move ahead on making enriched uranium, which can be fuel for nuclear power reactors or the explosive core of atom bombs. Tehran also warned it could withhold oil from a tight world market.

Diplomats said such measures would have forced the IAEA board to meet earlier than planned, possibly hastening a referral to the UN Security Council, which has the power to impose penalties on Iran.

But Iran held off from a precipitous move, saying it will only begin enrichment if it is actually referred to the world body.

"Iran has a good chance of blocking referral and they are close to getting away with conversion," which is the first step in enriching uranium, said Samore, an analyst at the MacArthur Foundation in Chicago.

"They have no interest now to escalate the situation," Samore said.

"Both the West and Iran had backed themselves into a corner over this issue and are looking for a face-saving solution," a Western diplomat close to the IAEA said.

The European Union called Monday on Iran to reinstate a full suspension of sensitive nuclear activities, and reaffirmed its desire to resume negotiations with Tehran.

The United States knows that going to the Security Council without Russian support is a waste of time since Russia has a veto there, the diplomat said. Russia abstained from the IAEA vote September 24, in what was seen as a victory for the West.

But Russia has warned Washington that moving too fast on the Iranian issue "would damage US-Russian relations," the diplomat said.

Iran, meanwhile, is still hoping for a compromise that would allow it to keep on converting uranium into the gas that is the feedstock for making enriched uranium.

Iran froze atomic fuel cycle work two years ago as a "confidence-building measure" amid talks with the European Union on guaranteeing that it was not secretly developing nuclear weapons. It resumed conversion work in August but held off from actual enrichment.

"The Iranians could reduce the amount being converted, or let the feedstock gas be taken to a third country, such as South Africa, for safekeeping," the diplomat said.

In any case, the Iranian leadership appears to have backed away from incendiary statements.

Non-aligned power India said last week that it had no indication Iran would retaliate over its vote at the IAEA against Tehran, despite a report that the Islamic regime was cancelling a major natural gas deal with New Delhi.

Seperately, Russia on Monday urged Iran to adopt a protocol allowing short-notice IAEA international inspections of its controversial atomic facilities.

Iran's conservative-controlled parliament took steps last week towards adopting a bill that would oblige the Iranian government to reject the conditions of the additional protocol to the NPT.

Iran signed the protocol in 2003 but has not ratified it, although it has been allowing IAEA inspectors access according to its provisions.

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