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Iran questions nuclear deal deadline as talks 'hit wall'

By Stephanie Nebehay and John Irish

GENEVA/PARIS (Reuters) - Iran, after talks with senior U.S. officials, questioned whether a July deadline for a nuclear deal with world powers will be met, fueling doubts on the outcome as France spoke out, saying talks on curbing Tehran's uranium enrichment had "hit a wall".

Iran's talks with six major powers on curbing its nuclear program in exchange for an end to Western sanctions could be extended for six months if no deal is reached by a July 20 deadline agreed by all parties, a senior Iranian official said.

While an extension is possible under the terms of the talks, experts believe both Iran and the international powers may face domestic political pressures to argue for better terms during this extra time period, further complicating negotiations.

The Iranian official, Deputy Foreign Minister Abbas Araqchi, said it was "too soon to judge" whether more time was needed.

"But the good thing is all parties are seriously committed to meet that goal," he said of the July 20 target. "Whether we can do it or not is something else," he told Iranian media in Geneva. A recording of his remarks were reviewed by Reuters.

After holding bilateral talks with U.S. officials, Araqchi was quoted as saying that differences remained.

"An exchange of views will continue," he told Iran's Fars news agency. "The talks were useful, especially before the next round of talks in Vienna. However, a diversity of opinions still exists."

The six powers and Iran will meet again in Vienna for another round of negotiations June 16-20.

Araqchi had earlier spoken of a possible half-year extension to the talks. Western and Iranian officials have already said an extension appears increasingly likely.

Singling out a big gap in negotiating positions that will be difficult to overcome in less than two months, France's foreign minister said Iran should drop a demand to have thousands of uranium enrichment centrifuges.

Instead it should restrict itself to a few hundred of the machines used to increase the concentration of the fissile isotope of the metal - a process that can make a weapon, though Iran denies it wants to do that.

Iran - which says its nuclear program is peaceful and mainly aimed at generating electricity - has around 19,000 centrifuges, of which roughly 10,000 are operating, according to the U.N. nuclear agency. Enriched uranium can have both civilian and military uses, depending on the degree of refinement.

"We are still hitting a wall on one absolutely fundamental point, which is the number of centrifuges which allow enrichment," Foreign Minister Laurent Fabius told France Inter radio. "We say that there can be a few hundred centrifuges, but the Iranians want thousands, so we're not in the same framework."

"UNREALISTIC DEMANDS"

Reporters in Washington asked State Department spokeswoman Jen Psaki about Fabius' comments. She said the focus should be on the actual negotiations taking place behind closed doors, not on what parties to the talks are saying publicly.

"I've seen those remarks," she said. "We feel our efforts should be directed towards the negotiations happening behind the scenes on the tough issues and not on public demands."

Paris has long held out for strict terms in the negotiations. Based on Psaki's remarks, it appeared that Fabius was not necessarily speaking for the other five powers - the United States, Germany, Britain, China and Russia.

French Foreign Ministry spokesman Romain Nadal said the priority was not the July 20 deadline, but to achieve a deal to guarantee that Tehran would not obtain a nuclear weapon.

Western officials say Iran wants to maintain a uranium enrichment capability far beyond what it currently needs for civilian purposes. Iran says it wants to avoid reliance on foreign suppliers of fuel for planned nuclear reactors.

The negotiations ran into difficulty last month with each side accusing the other of making unrealistic demands, raising doubts about prospects for a breakthrough next month. This week's bilateral talks between U.S. and Iranian officials were aimed at breaking the deadlock.

An extension should be possible, but U.S. President Barack Obama would need to secure the consent of Congress at a time of fraught relations between his administration and lawmakers.

Close U.S. ally Israel, which in the past has threatened to attack Iranian nuclear sites, has made clear its deep scepticism about the chances of a deal that sufficiently denies Iran any nuclear weapons capability. Iran says it is Israel's assumed nuclear arsenal that threatens peace in the region.

Iran and the powers included the July 20 deadline to reach a comprehensive agreement in an interim deal agreed in November.

The November agreement - under which Iran suspended some nuclear activities in exchange for limited sanctions relief - allowed for a six-month extension, if more time were needed for a settlement. An extension would allow up to half a year more for limited sanctions relief and restraints on Iranian nuclear work.

"TOUGH CHOICES" REQUIRED

U.S. Deputy Secretary of State Bill Burns and Under Secretary of State Wendy Sherman, the primary U.S. negotiator with Iran, met an Iranian delegation led by Araqchi in Geneva on Monday and Tuesday.

"We are at a critical juncture in the talks," State Department spokeswoman Marie Harf said in Washington.

"We know we don’t have a lot of time left," she said of the July 20 deadline. "That’s why we’ve said diplomacy will intensify. People need to make tough choices."

Araqchi, the Iranian deputy foreign minister, used similar language: "There are still gaps," he said. "In order to bring our views closer, the other side must make tough decisions."

The French Foreign Ministry said officials from France and Iran would meet on Wednesday to discuss the Vienna negotiations. And Russian officials will have talks with the Iranians in Rome on Wednesday and Thursday, according to Iranian media.

German and Chinese officials will also hold talks with Iranian officials ahead of next week's negotiations in Vienna.

(Additional reporting by Michelle Moghtader in Dubai, Parisa Hafezi in Ankara, Fredrik Dahl in Vienna and Louis Charbonneau in New York; Writing by Louis Charbonneau and Fredrik Dahl; Editing by Mark Heinrich, Giles Elgood Alastair Macdonald and Gunna Dickson)

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