BAGHDAD Talks between Iran and world powers to defuse a dispute about Iran's nuclear goals go into a second day on Thursday with Washington cautiously hopeful of progress towards an agreed framework for addressing concerns that Tehran wants to build an atom bomb.
"I believe we have the beginning of a negotiation," a senior U.S. official said of the discussions, which opened on Wednesday in the Iraqi capital, Baghdad, in a renewed effort at diplomacy that will seek to ease decades of ingrained mistrust.
"We have got engaged ... we have had detailed discussions" for a potential further round of talks, the official said, adding the meeting would continue into a second day on Thursday.
The discussions, watched closely by global oil markets as well as by Iran's arch-enemy Israel, are aimed at exploring ways to settle a long-standing dispute about a nuclear energy programme the West suspects is aimed at nuclear bomb research. Tehran has long stated the programme is strictly for peaceful purposes.
Both sides - Iran on the one hand and the United States, Russia, China, France, Britain and Germany on the other - have been publicly upbeat about the scope for an outline deal following a 15-month diplomatic freeze and exploratory talks in Istanbul last month.
In previous meetings, the two sides could not even agree on an agenda, with each largely repeating known positions and Tehran refusing any dialogue on changes to its nuclear path.
But international energy markets remain nervous, unsettled by extended Western sanctions imposed on Iran's crude exports and the specter of a Middle East conflict arising from possible Israeli strikes against Iran's nuclear installations.
Speaking after the first day of discussions, the senior U.S. official said the meeting revealed a "fair amount of disagreement" but also areas of common ground.
"But still we have to come to closure ... about what are the next appropriate steps."
The overall goal of the six countries jointly negotiating with Tehran is an Iranian agreement to curb uranium enrichment in a transparent, verifiable way to ensure it is for peaceful purposes only. Iran's priority is to secure an end to sanctions isolating the country and damaging its economy.
The senior U.S. official later confirmed that the six powers had also put specific measures to lessen sanctions pressure on the table in the discussions as part of a possible confidence-building package, but declined to elaborate.
IRAN HINTS AT FLEXIBILITY
The pivotal proposal by the six, led by European Union foreign policy chief Catherine Ashton, was for Iran to halt its enrichment of uranium to the higher fissile concentration of 20 percent, her spokesman, Michael Mann, said as talks got under way.
That is the Iranian nuclear advance most worrying to the West since it largely overcomes technical obstacles to reaching 90 percent, or bomb-grade, enrichment. Iran says it is enhancing the fissile purity to such a degree only for medical research.
Tehran has repeatedly ruled out suspending enrichment as called for by several U.N. Security Council resolutions.
But Iran has hinted at flexibility on higher-grade enrichment, although analysts caution that it would be unlikely to compromise much while sanctions remain in place.
Iranian media close to the Tehran government said its chief negotiator, Saeed Jalili, presented its own five-point package of proposals covering a "comprehensive" range of nuclear and non-nuclear issues.
But a European diplomat, referring to the reported Jalili proposals, said: "We are not quite sure what these five points are. We are trying to find out. There are no details."
(Additional reporting by Patrick Markey and William Maclean in Baghdad, Marcus George in Dubai, Fredrik Dahl in Vienna and Steve Gutterman in Moscow; Writing by Mark Heinrich; Editing by Peter Cooney)