The U.S. and other nations fear such expertise could one day lead to a bomb.
New sanctions are probably months away, and Tehran is running out the clock on the Bush administration in hopes of getting a better offer from a new U.S. president next year, the State Department said.
"We see this as a stalling tactic," State Department spokesman Gonzalo Gallegos said of the short, vague reply Iran delivered early Wednesday to the latest invitation from a European diplomat who has tried for years to lure the clerical regime into negotiations.
The U.S. and a fragile partnership of countries that do business with Iran are trying to buy out the most sophisticated part of the oil giant's nuclear program, leaving Tehran able to produce energy but not bombs. Iran says it isn't seeking weapons and won't scale back a legitimate energy-production program.
The Bush administration's recent willingness to join talks with Iran, if the country makes concessions first, marked a major shift in tactics toward a nation that President George W. Bush declared was part of an "axis of evil" during his first term. The gambit has not produced the results Bush's advisers had hoped it would. The latest news probably does not make war with Iran any more likely, but it also dims chances for any breakthrough after three decades of enmity.
Iran didn't rebuff the latest offer outright, and as usual there were several interpretations of the regime's motives. Iran is showing new signs of openness to talks, but any bold move may come only after Bush leaves office.
Republican John McCain and Democrat Barack Obama both say they would continue tough diplomacy with Iran, offering both the promise of talks and the threat of sanctions. Obama has said he would consider expanding talks with Iran and would even meet directly with hardline President Mahmoud Ahmadinejad if he thought it worthwhile.
To keep up the pressure, the European Union is expected to announce new sanctions of its own within days, and the nations hoping to bargain with Iran are starting the lumbering process of drawing up a fourth round of U.N. penalties. Russia and China, which hold veto power and have opposed truly onerous sanctions against Iran, are on board for now.
"The document contains no substantive response," Russian Foreign Ministry spokesman Andrei Nesterenko said. "We will maintain all options for further contacts with the Iranian side in order to clarify its position and reach a negotiated solution."
German Foreign Minister Frank-Walter Steinmeier called the Iranian reply "insufficient."
"With this offer we have emphasized that we are going to great lengths to achieve a diplomatic solution to the nuclear conflict," he said.
The U.N. Security Council already has passed three sanctions resolutions against Iran. Despite that pressure and the threat of a fourth, Iran has yet to agree to stop enriching uranium in exchange for economic and other incentives being offered by the six countries: Britain, China, France, Russia, the United States and Germany. Uranium enrichment can produce the ingredients needed to build an atomic bomb.
The current sanctions narrowly target people and companies associated with Iran's nuclear and missile programs. The council also banned trade with Iran in some goods that have both civilian and military uses.
The penalties don't crimp Iran's booming oil business and have little direct economic effect. The United States argues that the real value of sanctions is that international investors will think twice about doing business with Iran.
"If Iran continues to refuse to come to the negotiating table, the international pressure on Iran will only grow," a statement from the British foreign office said.
In a statement, the French Foreign Ministry said France still supports a double approach of "dialogue and firmness."
"The path of dialogue remains open but, in the absence of a clear response, Iran is making the choice to expose itself to new sanctions," the statement said.
The bargaining partnership had hoped that Iran would agree to freeze its nuclear work at the current level in exchange for a freeze on new sanctions. The United States once opposed those conditions for talks as too lenient, but now would go along.
That incentive and others are still on the table, but "we're cracking the door open on the disincentives package," Gallegos said.
U.S. officials expect the U.N. Security Council could approve new sanctions in October or perhaps later in the fall.
The decision to seek further penalties came in a conference call linking European Union foreign policy chief Javier Solana with senior diplomats from the five permanent members of the U.N. Security Council, as well as Germany, the State Department said.
Iran's response repeated its long-standing position that it has a right to peaceful nuclear activities and said it would not give a definitive answer to the offer until its own questions about it had been answered.