Iran Makes Concession, Sort Of

The U.N. deadline for Iran to stop uranium enrichment came and went and, in this game of international brinksmanship, nobody blinked.

Throughout the spiraling conflict, slathered in tough talk on all sides, Iran had said it would not bow to international pressure, apparently banking on the deep split in the Security Council over the "or else" portion of the United Nations' demand.

Russia and China did not budge from their opposition to U.N. sanctions as punishment, leaving the United States, Britain and France hamstrung and facing a possible Security Council veto by the Kremlin and Beijing.

Iran, however, appeared to have understood it may have pushed the international community as hard as it could for the time being.

On Saturday, the Islamic republic issued a concessionary proposal that might offer a way out of the dangerous stalemate, which U.S. President George W. Bush has said caused the United States to leave the military option on the table.

"If the issue is returned to the International Atomic Energy Agency, we will be ready to allow intrusive inspections," Mohammed Saeedi, Iran's deputy nuclear chief, told state-run television.

His words appeared to anticipate an international loss of patience that was voiced Saturday by Russian Foreign Minister Sergey Lavrov, a steadfast opponent of sanctions.

Lavrov told his Iranian counterpart Manouchehr Mottaki by telephone that Iran must halt enrichment and cooperate with IAEA.

According to a Foreign Ministry statement, Lavrov demanded that Iran "suspend" research and development on enrichment and "provide full-format cooperation" with the IAEA to "clear up the IAEA's remaining questions."

But, as CBS News correspondent Elizabeth Palmer reports, the Iranian offer can be read two ways. The Islamic republic could be bidding for more talks, perhaps a sign of the Iranians backing down. Or, it could be a threat against the West, an indication that the Iranian government will stop international cooperation all together.

In February, Iran barred intrusive inspections of its nuclear facilities by the IAEA, the U.N. agency that monitors compliance with the Nuclear Nonproliferation Treaty, after it was referred to the U.N. Security Council over its nuclear activities.

Several Western countries, the United States, Britain and France in particular, suspect the program is aimed at producing nuclear warheads.

By offering a return of so-called snap inspections, Iran appeared to be giving ground in an attempt to convince the IAEA, and through it the world community, that it was telling the truth when it said it was enriching uranium only as fuel for reactors to generate electricity.

"What is up for negotiation is to remove concerns of probably few countries in negotiations," Saeedi told Iranian television in a direct reference to the concerns or allegations in the West.

Throughout the confrontation over Iran's nuclear program, experts such as Saeedi and those on the diplomatic front lines have carried messages that are less threatening than those issued by President Mahmoud Ahmadinejad, a variation on the "good cop, bad cop" routine.

Iran's U.N. Ambassador Javad Zarif joined Saeedi Saturday in what appeared to be a concerted effort to find a way to ease the crisis, echoing the language issued in Tehran.

"There are a multitude of possibilities for reaching a solution, if we start from the basic assumption that Iran has the right (to nuclear power) ... and Iran should not develop nuclear weapons," Zarif told the British Broadcasting Corp. radio.

"I believe if you start from these two assumptions and not draw arbitrary red lines then we will be able to reach a mutually acceptable negotiated solution," he said.

Those words presented a much different tone than an Ahmadinejad statement Friday: "The Iranian nation won't give a damn about such useless (U.N. sanctions) resolutions."

The regime sounds confident, but in the streets and bazaars, there is anxiety, reports CBS News correspondent Elizabeth Palmer from Tehran. Iran's economy has been suffering since president Ahmadinejad took power and sanctions will make it worse.

At Teheran's version of a commodities exchange traders are buying up gold as a hedge against an economic crash while the middle class is stockpiling gold coins. And though Iran ranks number two in OPEC, investment in the crucial oil sector is drying up — incredibly, the government is planning to ration gasoline, Palmer adds.

In conjunction with the Friday deadline to halt enrichment, Mohamed ElBaradei, the IAEA chief, confirmed in a report that Iran had successfully produced enriched uranium and had defied the U.N. Security Council deadline.

But Mr. Bush, perhaps foreseeing Iranian eagerness to keep its case from reaching a full-scale sanctions debate in the Security Council, responded with extreme care Friday.

He said the world was concerned about Iran's "desire to have not only a nuclear weapon but the capacity to make a nuclear weapon," language that was one degree less accusatory than past statements.

Mr. Bush added he was not discouraged, saying: "I think the diplomatic options are just beginning."

A senior IAEA official tells CBS News that Iran's cooperation with inspectors was "lukewarm" and "tepid at best." The report details the stonewalling; for instance, Iran refused to account for all its plutonium, reports CBS News White House correspondent Jim Axelrod.

Saeedi, however, did not back away from Iran's drive to enrich uranium and said that the country was pushing forward with further technological developments, the installation of two more 164-centrifuge cascades at its uranium enrichment plant in Natanz, in central Iran.

"(Uranium enrichment in) Natanz is continuing its work well ... two other cascades (of 164-machine centrifuges) are being installed," Saeedi said.

He said Iranian scientists were also studying more advanced centrifuges than those on which Ahmadinejad announced research earlier this month. The more sophisticated equipment speeds up the enrichment process.

"What we are conducting research on is not only P-2 but even more advanced machines," Saeedi said, adding that Iran had not moved beyond using the P-1 centrifuges.

"Our efforts are to use the most sophisticated machines, like in Germany, Netherlands, Japan and Brazil," he added.

Suspicions about Iran's intentions have grown since it was discovered in 2002 that the Tehran regime had for two decades secretly operated large-scale nuclear activities that could be used in weapons making.