The US is embarking on a major rethink of its policy towards Iran, which could see it dropping the strategy of confrontation and threat, instead offering Tehran incentives for abandoning its suspected nuclear ambitions.
The striking change of policy emerged during President Bush's fence-mending trip to Europe last week, when for the first time he indicated that Washington endorsed the tripartite effort by France, Britain and Germany to reach a deal with Iran, offering technology in return for an end to its uranium enrichment programme.
It comes on the eve of a key meeting of the International Atomic Energy Agency (IAEA) in Vienna tomorrow, at which the UN nuclear watchdog agency is due to take stock of Iran's nuclear activities, and decide on a new four-year term for its director, Mohammed ElBaradei.
In the past, the US has tried to oust Dr ElBaradei, who irritated Washington in the run-up to the Iraq war by publicly casting doubt on the supposed WMD threat posed by Saddam Hussein. More recently, the US has accused him of being too soft on Tehran.
But that campaign may now have been quietly dropped, amid the new-found spirit of unity with Europe.
Mr Bush declared that the two sides of the Atlantic were now "on the same page" over Iran - the nearest Washington has come to endorsing the three-nation EU initiative over which just weeks ago it was sceptical to the point of open scorn. Further quieting European concerns, Mr Bush said talk of a military attack on Iran was "ludicrous".
Top US policy-makers will now examine whether incentives, such as helping Iran join the World Trade Organisation, could be more productive.
Iran has promised a limited suspension of its uranium enrichment activities while talks continue. But the negotiations seem balanced on a knife edge, with Tehran accusing Washington of trying to undermine the Franco-British-German effort.
The main focus of concern is the Natanz uranium enrichment plant south of Tehran. International suspicions that Iran was seeking a nuclear weapon soared when IAEA inspectors discovered traces of highly enriched weapons-grade uranium at the facility in 2003 - despite Iran's assertions that its programme was purely for civilian purposes. Enrichment activities at Natanz are currently at a standstill. But US officials say Iran may have other undeclared enrichment facilities.
There have been reports that elite US units have been on the ground inside Iran pinpointing targets for airstrikes or commando raids, while Israel has dropped heavy hints it would stage an Iranian version of its 1981 attack on Iraq's Ozirak reactor if nothing is done. But every independent study here has concluded that the military option is not feasible.
The seeming rapprochement between the US and Europe over Iran contrasts sharply with the visible strains between the US and Moscow, evident during Mr Bush's meeting with President Putin in Bratislava on Thursday.
Russia, like the US and Europe, says it opposes Iran becoming a nuclear power. But it has infuriated Washington by promising to continue its long-standing support for the country's nuclear energy programme.
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Washington in u-turn over Iran’s nuclear programme
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