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Yahoo! My Yahoo! Mail More Yahoo! Services Account Options New User? Sign Up Sign In Help Yahoo! Search web search Home Singapore Asia Pacific World Business Entertainment Sports Technology Africa Europe Latin America Middle East North America Iran hits at U.N. nuclear watchdog Reuters - Tuesday, September 21 Send IM Story Print By Fredrik Dahl and Sylvia Westall VIENNA - Iran said on Monday the U.N. nuclear watchdog was suffering a crisis of "moral authority and credibility," underlining worsening relations between Tehran and the International Atomic Energy Agency. In a speech to IAEA member states including the United States, Iran's nuclear energy chief Ali Akbar Salehi also voiced continued defiance over international demands that the Islamic state stop work the West suspects is aimed at making atom bombs. "The uncivilized double-track approach of threat and dialogue cannot be conducive and fruitful," he said, referring to the West's policy of imposing sanctions on Iran while offering incentives for it to back down in the eight-year row. Speaking shortly afterwards at the same annual assembly of the 151-member Vienna-based United Nations body, U.S. Energy Secretary Steven Chu made clear Washington would keep pressuring Iran over its disputed nuclear activities. The United States remains committed to pursuing a diplomatic solution, but "Iran must do what it has thus far failed to do -- meet its obligations and ensure the rest of the world of the peaceful nature of its intentions," Chu said. "Otherwise, it is clear that there is a broad and growing international consensus that will hold Iran accountable if it continues its defiance," he said. Salehi criticised the IAEA's latest report on Iran's nuclear work as unfair and suggested Western powers had influenced it. "It appears that the agency is suffering from moral authority and credibility crisis," Salehi said. The report showed Iran escalating nuclear fuel enrichment work, which it says is for peaceful uses only, in defiance of tougher U.N., U.S. and European sanctions introduced since June. It also voiced frustration over Iran's lack of full cooperation with IAEA inspectors and investigators. IRAN SEEKS FUEL TALKS Relations between Iran and the IAEA have deteriorated since Yukiya Amano took over as head of the agency in December. He has taken a blunter approach on Iran than his predecessor Mohamed ElBaradei, saying in his reports to the IAEA's board of governors that Tehran could be trying to develop a nuclear-armed missile now, not only at some point in the past. Iran said in June it had barred two IAEA inspectors, accusing them of giving "false" information on its activities. Amano, a Japanese diplomat, has said Iran's repeated rejections of his staff was hampering the IAEA's work and Western powers have accused Tehran of intimidating the agency. Salehi also called on major powers to resume talks "without further delay" on a plan to provide nuclear fuel to a Tehran medical reactor in exchange for some of its low-enriched uranium stockpile -- potential bomb material if refined to a high level. Regarded at the time by world powers as a prospective confidence-building step, the deal stalled last year after Iran backed away from the initial terms for an atomic fuel swap. Western diplomats do not rule out a resumption of the nuclear fuel discussions. But they stress the need for broader negotiations which they hope will lead to Iran suspending uranium enrichment, something it has repeatedly ruled out. In its statement at the IAEA assembly, the European Union urged Iran to meet with major powers "with the ultimate goal of establishing a comprehensive relationship, involving cooperation in all fields ... and benefiting both sides." In Washington on Monday, a U.S. Treasury official said Iran was struggling with international sanctions and pressure on its economy and banking sector was mounting. Iran, the world's fifth-largest oil exporter, has dismissed the impact of sanctions on its economy. Salehi denounced the punitive measures as "unjustified and illegal." 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