By Louis Charbonneau and Yeganeh Torbati
GENEVA (Reuters) - The United States increased pressure on Iran on Wednesday to agree in the next two days a "first step" nuclear deal that would see it halt expansion of its atomic program and reverse parts of it.
On the eve of two-day talks with world powers, a senior U.S. administration official said that Washington could, in return, offer Iran "very limited, temporary, reversible" relief on the sanctions imposed to pressure Tehran to stop the nuclear activities that the West fears are weapons-related.
"For the first time, Iran appears to be committed to moving this negotiation process forward quickly," the official said on condition of anonymity, adding: "nothing is yet agreed to (and) there are gaps between the two sides which remain quite real."
The Geneva talks are the second round of negotiations that started in the Swiss city last month, seeking to build on a diplomatic opening created by the June election of Hassan Rouhani as Iran's new president, promising to open a fresh dialogue with the West.
Washington has called the last session productive, in contrast to previous meetings at which, Western participants said, the Iranians often read out long speeches that had little or nothing to do with their nuclear program.
This week's meeting between Iran and the five permanent U.N. Security Council members - Britain, China, France, Russia and the United States - and Germany (P5+1) should aim to build on that, the official said.
"What we're looking for is a first phase, a first step, an initial understanding that stops Iran's nuclear program from moving forward and rolls it back for first time in decades."
A deal would likely need to involve suspending the expansion of Iran's enrichment centrifuge program, halting the introduction of more advanced centrifuges, ending uranium enrichment to 20 percent fissile purity level and allowing U.N. inspectors to conduct more intrusive inspections.
Washington and Europe also want Tehran to halt construction of the Arak heavy water reactor that would be capable of producing plutonium if it became operational.
IRAN: GENEVA TALKS "A TEST"
Such moves by Tehran would create space for further negotiations on a comprehensive settlement, the official said. "We're looking for ways to put additional time on the clock."
Israel, which along with its U.S. ally has said it does not rule out military strikes on Iran to stop it getting the bomb, is opposed to any such deal.
"Israel's assessment is that the P5+1 is in a very strong position because of the sanctions that are hurting Iran and ... they have the ability to compel Iran to cease all enrichment at all levels and cease all work at Arak," an Israeli official told Reuters on condition of anonymity.
Israel has learned that a deal to be proposed in Geneva would offer sanctions relief in exchange for Iran ceasing uranium enrichment to 20 percent and slowing down work at Arak, the official said.
"From Israel's point of view, this is a very bad deal ... Israel is expressing its opposition to half-deals like this and will continue to do so."
Iran denies it is seeking weapons capability and says it enriches uranium for peaceful energy and medical purposes only.
But its refusal to curb nuclear activity that can also have military applications has drawn sanctions from the United Nations, the United States and the European Union. The Western embargoes have ravaged Iran's oil-dependent economy with high inflation and a sharp decline in the value of its currency.
Iran's senior negotiator, Deputy Foreign Minister Abbas Araqchi, told Iran's Press TV on Wednesday that Tehran saw this week's meeting as a test of the powers' seriousness.
"The Geneva talks will be a measure to test the P5+1 group and in these negotiations the level of their political will to reach a resolution will be put to test," Araqchi said.
The U.S. official urged Congress to hold off on new sanctions against Iran while negotiations continue.
"What we are saying to them is: let us have a pause, a brief one," the official said.
"I have said to the Congress and I have said to the Iranians that we have asked for this pause, but if we do not move forward quickly on a first step that will buy us some time for a comprehensive agreement, that we will be right with the Congress to impose additional sanctions."
(Additional reporting by Fredrik Dahl and Justyna Pawlak and by Ori Lewis in Jerusalem; Editing by Robin Pomeroy)