The US is to impose more sanctions The International Atomic Energy Agency (IAEA) on Tuesday released a trove of “credible” information that Iran “has carried out activities relevant to the development of a nuclear explosive device” and that some of these activities “may still be ongoing.”
With Washington threatening to increase international pressure on Iran and Israel's president stoking speculation of a pre-emptive strike, the report was set to stoke Middle East tensions.
The U.N. nuclear watchdog said Iran is suspected of conducting secret experiments whose sole purpose can only be the development of nuclear arms.
“The agency has serious concerns regarding possible military dimensions to Iran’s nuclear program,” the keenly awaited report said.
“After assessing carefully and critically the extensive information available to it, the agency finds the information to be, overall, credible.”
“This information indicates that Iran has carried out activities relevant to the development of a nuclear explosive device.”
“The information also indicates that prior to the end of 2003, these activities took place under a structured program, and that some activities may still be ongoing,” the IAEA added.
“Given the concerns identified above, Iran is requested to engage substantively with the agency without delay for the purpose of providing clarifications.”
The Vienna-based agency said some of its more than 1,000 pages of information indicated Iran has done work “on the development of an indigenous design of a nuclear weapon including the testing of components.”
Iran rejected the IAEA report as unbalanced, unprofessional and politically motivated, the official Fars new agency said on Tuesday.
Tehran's envoy to the Vienna-based agency, Ali Asghar Soltanieh, on Wednesday accused IAEA chief Yukiya Amano of making a "historic mistake" in releasing the document.
Amano had displayed "unbalanced, unprofessional and political" behaviour in publishing the report, which contained "false claims" based on information from Iran's arch-foe the United States and other countries, Soltanieh said, as cited by the official IRNA news agency..
He added Iran "will never compromise its legitimate rights" in pursuing its atomic programme.
"As a responsible state, the Islamic republic of Iran will never compromise its legitimate rights and will continue to comply with its commitments under the nuclear Non-Proliferation Treaty," Soltanieh said.
"Iran will continue its peaceful nuclear activities. And, just as many other previous claims were proven baseless, this time also they will not bear any results," he said.
Previous IAEA assessments have centered on Iran’s efforts to produce fissile material – uranium and plutonium –which can be put to peaceful uses like power generation, or be used to make a nuclear bomb.
But the new update focuses on Iran’s alleged efforts towards putting the radioactive material in a warhead and developing missiles.
It comes amid rising speculation that Israel might launch a pre-emptive military strike in an attempt to knock out its arch foe’s nuclear facilities.
The Chairman of the Foreign and security Committee in the Israeli Kenesset, Shaul Mofaz, said on Wednesday that the missiles owned by Iran can reach the majority of European capitals, stressing that “we in Israel will not accept Iran as a nuclear state.”
Mofaz said in remarks to Israeli radio: "The time has now come for the West to tighten sanctions on Iran," adding that military action was the worst option.
The Israeli official, who has served as Secretary of the Army in Israel for several years, called on the Western countries to work to change the way the world deals with the Iranian nuclear threat.
He added that "one might think that in the immunity  from the Iranian threat is certainly a mistake," stressing that "the moment of truth exists now in the face of international foreign policy pursued by governments in the West."
Mofaz said that “the IAEA’s report on Iran's nuclear activity did not contain any new information for Israel, but he revealed the real face of Iran's actual intentions."
He stressed that "this report is essentially an opportunity for the world to take action against Iran," he said.
 "I think the time has come to tighten the sanctions and affect the Iranian economy."
He said that "any military action of any kind, especially by Israel, includes the last and worst option," saying at the same time that "all options must be placed on the table to be ready.”
Iran, which says its nuclear program is peaceful and which has been hit by four rounds of U.N. Security Council sanctions, dismissed the new IAEA report prior to its publication, saying it was based on falsified information.
Russia and China had meanwhile pressured the IAEA not to even publish the report, diplomats said, and as a result it is unclear what action the agency’s board will take when it meets next week.
 “We have serious doubts about the justification for steps to reveal contents of the report to a broad public, primarily because it is precisely now that certain chances for the renewal of dialogue between the ‘sextet’ of international mediators and Tehran have begun to appear,” the Russian Foreign Ministry said in a statement.
It said time was needed to study the report and determine whether it contained new evidence of a military element in Iran’s nuclear program or was nothing but “the intentional – and counterproductive – whipping up of emotions.”
Turning to reports that Iran received assistance form a former Soviet weapons scientist to overcome technical hurdles in mastering the critical steps needed to build nuclear weapons, the Foreign Ministry said Russia had long ago provided the IAEA with “all the necessary clarifications” on the issue and that recent reports contained nothing new.
Russian President Dmitry Medvedev warned Tuesday that Israeli threats to attack Iran over its nuclear program were “extremely dangerous rhetoric” that could result in a “catastrophe.”
A U.S. official said the United States will likely increase sanctions on Tehran after the IAEA report, according to Reuters news agency.
US Senator John Kerry, head of the Senate Foreign Relations Committee, said the report made it clear that Iran "has not been truthful" and that the international community had to "increase pressure" on Tehran.
"Iran's leaders know what they need to do, the question is how we ensure they start doing it," Kerry said.
In Israel, Foreign Minister Avigdor Lieberman said before the IAEA report only crippling sanctions against Iran's central bank and its oil and gas industries would force Tehran to halt its nuclear drive.
"If, after the IAEA report comes out, the United States does not lead an initiative of crippling sanctions against Iran, this will mean that the United States and the West have accepted a nuclear Iran," he said in Maariv newspaper.
A US official said, however, that targeting Iranian Central Bank was not on the U.S agenda and that sanctioning Iran’s oil and gas sector was very sensitive.
“I don’t think we are there yet,” the official said.
Israeli President Shimon Peres had said on Sunday that a strike against Iran was becoming more likely, in one of the starkest warnings by the Jewish state to Tehran in recent times.