Iran has said it could suspend a part of its uranium-enrichment program and is ready to resume nuclear talks with the major powers without setting conditions, in what Western officials said Wednesday were signs that Tehran has been taken aback by the scale of international sanctions launched against it. U.S. and European diplomats welcomed Iran's offers, though with skepticism, given the tortuous history of Iran's negotiations during a seven-year international tug of war over the country's nuclear ambitions
Iran has said it could suspend a part of its uranium-enrichment program and is ready to resume nuclear talks with the major powers without setting conditions, in what Western officials said Wednesday were signs that Tehran has been taken aback by the scale of international sanctions launched against it.

U.S. and European diplomats welcomed Iran's offers, though with skepticism, given the tortuous history of Iran's negotiations during a seven-year international tug of war over the country's nuclear ambitions. Iran denies international allegations that it is pursuing nuclear weapons.

Speaking in Istanbul on Wednesday, Turkish Foreign Minister Ahmet Davutoglu said his Iranian counterpart, Manouchehr Mottaki, had pledged on Sunday to stop enriching uranium to the higher grade needed for a medical-research reactor, provided that world powers agree to a fuel-swap deal Tehran outlined in May with Turkey and Brazil.

A fuel-swap proposal was a centerpiece of the past year's talks with Iran, as United Nations Security Council members proposed sending Iranian uranium abroad in exchange for 20%-enriched fuel rods for its research reactor. Iran welcomed the deal, but then backed away, before formulating the May swap plan.

But Iran insisted it would also continue enriching its own nuclear fuel to 20% -- a step, many international officials believed, toward creating nuclear weapons. Last month, the U.N. imposed fresh sanctions against Iran. The U.S. and European Union followed with their own harsher measures.

Mr. Mottaki said "there will be no need for Iran to continue 20% enrichment if the Tehran Agreement was realized and the country gets the fuel it needs," Mr. Davutoglu told a joint news conference with German Foreign Minister Guido Westerwelle.

A spokesman for Iran's foreign ministry couldn't be reached to comment.

U.S. officials Wednesday said they were studying Iran's recent discussions with Turkey as well as a letter Tehran sent Monday to the U.N.'s nuclear watchdog, the International Atomic Energy Agency. But the Obama administration's initial response to the letter was negative.

One official briefed on Tehran's correspondence said Iran appears to be seeking to use the fuel-swap proposal as a tool to weaken sanctions without addressing Washington's concerns about Iran's broader nuclear program. The official said Iran doesn't answer in the letter specific questions raised by the U.S., Russia and France -- the so-called Vienna Group -- about Iran's May fuel-swap agreement.

And Iran, through the letter, seeks to make Turkey, Brazil and the Vienna Group its diplomatic interlocutor, instead of the five U.N. Security Council members plus Germany.

"There's a concern that Iran is pursuing the fuel swap as a way to weaken sanctions and avoid the important questions," said a U.S. official working on Iran.

EU foreign policy representative Catherine Ashton also has been in correspondence with Iran about a September meeting, Western diplomats say. Here, too, they say, Tehran has avoided committing to direct negotiations about its wider nuclear program and has sought to include Turkey and Brazil in future negotiations.

U.S. and European diplomats said they believe the rash of new economic sanctions imposed on Tehran over the past two months has rattled the Iranian leadership. They said they have heard from Iranian officials, through interlocutors, that financial penalties the EU imposed this week were much more expansive than Tehran anticipated. The diplomats said there are already signs that the combination of new U.N., EU and U.S. sanctions are starting to have an impact on Iran's economy.

More than a dozen Iranian cargo ships have been stuck in Iranian ports in recent weeks, said a European official, due to their difficulties in obtaining insurance. European air-traffic controllers have also grounded Iranian airliners due to their failure to meet safety regulations.

"We've been getting more messages than usual that they'd like to get involved in talks," said the European official in Iran.

Iranian officials in recent days have publicly dismissed the sanctions, saying they will be ineffective. "By imposing sanctions they [can] not block the way of Iranian nation," President Mahmoud Ahmadinejad said Wednesday.