Rice ready for Iran, lowers Iraq talks expectations

By Sue Pleming

SHANNON (Reuters) - U.S. Secretary of State Condoleezza Rice said on Wednesday she could address any question from Iran during meetings in Egypt and sought to tone down expectations about talks to stabilize Iraq.

Speaking en route to Egypt's Sharm el-Sheikh resort for meetings that include Iran, Iraq's other neighbors and world powers, Rice ruled out "full-scale negotiations" with Iranian Foreign Minister Manouchehr Mottaki but said she would not avoid an exchange.

"If we encounter each other then I am certainly planning to be polite and see what that encounter brings," said Rice, who attended a meeting with Mottaki about Iraq last September at the United Nations but did not have any contact with him.

Rice said talks with Iran, which could be the most substantive high-level U.S. meeting with Tehran in nearly three decades, would focus on Iraq but she would not cut off a conversation if it turned to Tehran's nuclear program.

"I think I can handle any question that is asked of me," she said. "If we encounter each other and wander to other subjects I am prepared to address them at least in terms of American policy," added Rice before a refuelling stop in Ireland.

In London, U.S. Undersecretary of State Nicholas Burns said the talks in Egypt "will be important because Secretary Rice will be seated around the table with the Syrian foreign minister and we hope and think with the Iranian foreign minister, although the Iranians have been a little bit ambivalent."

"We look forward to a good discussion ... our ambition would be that we see these barriers come down and we see the two countries begin to talk and we see the prospect of a brighter and more peaceful Middle East," he told an audience at the Chatham House think tank.

The United States is at odds with Iran over its nuclear program and says it will negotiate with Iran only if it suspends uranium enrichment which Washington says is aimed at building a bomb and Iran says is for electricity generation.