Iran today started to enrich its existing nuclear fuel stockpile towards weapons grade strength.
The move caused international alarm and gave new impetus to Western calls for new sanctions on Tehran despite opposition from China, which insists that negotiations could still succeed.
"Today we started to make 20 per cent enriched nuclear fuel... in the presence of IAEA (International Atomic Energy Agency) inspectors at Natanz," an unnamed official told Iran's Arabic-language state television, al Alam.
A spokesman of Iran's Atomic Energy Organisation, Ali Shirzadian, confirmed that "preparatory work" had started at 9.30am (0600 GMT) and that production would formally get under way at about 1pm local time, Times Online reports.
According to New York Times, the Pentagon said the United States wants the U.N. Security Council to approve a resolution "within weeks, not months," laying the ground for new sanctions against Iran over its nuclear programme. They would be the fourth set of sanctions.
Despite Iranian denials, Western powers fear Iran is enriching uranium with a view to producing nuclear weapons.
Salehi said Iran had set up a chain of 164 centrifuges, used to refine uranium, to produce the 20 percent fuel. He said production capacity is 3 to 5 kg a month, above the Tehran reactor's needs of 1.5 kg, ISNA news agency reported.