`We have nothing to hide`, Iran envoy replies to Trump allegation

Spokesperson for Iran's atomic agency Behrouz Kamalvandi attends a press briefing in Tehran

The IAEA was also said to have verified that Iran's stockpile of low-enriched uranium had grown since the 300kg (660lb) limit was exceeded on 1 July.

Iran has said it will boost its uranium enrichment in a few hours above a cap set by the nuclear deal, a move that could mean the return of all economic sanctions on Tehran. It has set an early September deadline until it pushes limits further. The US has accused Iran of involvement in the bombing of oil tankers in the Gulf and says it shot down an American drone in worldwide airspace.

Mousavi said, "Despite taking such position by Iran, doors to diplomacy are still open". "Sanctions will soon be increased, substantially!"

USA and Iranian envoys to the International Atomic Energy Agency are expected to address the group Wednesday. They launched a new trade mechanism called Instrument in Support of Trade Exchanges (INSTEX) to continue trade with Iran in a non-dollar basis.

Zarif added Iran is limiting its commitments based on the paragraph 36 of the JCPOA. The U.S. backed out of that deal, but several European nations remain involved.

In the nuclear deal with world powers negotiated by the Obama administration, Iran had agreed to curb its nuclear activities in return for sanctions relief.

Fears of an Iran-US war have grown in recent weeks as tensions escalate. Oil exports dropped from 2.5 million barrels per day (bpd) to about 300,000 bpd in the first three weeks of June after the USA withdrew the waivers it had granted to a few countries, including India, to import oil from Iran.

Bonne arrived in Tehran after Iran announced on Monday it had surpassed 4.5% uranium enrichment - above the 3.67% limit under the agreement, though still far below the 90% necessary for military purposes.

Netanyahu has called on European signatories to the nuclear deal to impose "snapback sanctions" on Iran, which are the UN Security Council sanctions that were lifted under the nuclear deal.

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"20% is not needed now, but if we want we will produce it", Kamalvandi said, adding that there won't be any problem with this action.

Diplomats earlier told Reuters the IAEA told member states in a closed-door meeting Iran was enriching uranium to 4.5% purity, above the 3.67% limit set by the worldwide treaty.

That is partly because while Iran has breached the terms of the deal which the IAEA is policing, the IAEA is not a party to the deal and Iran has not violated the Safeguards Agreement binding it to the agency.

"While immensely popular to begin with, the nuclear deal has now lost some of its appeal among supporters in Iran".

The confrontation has brought the United States and Iran close to the brink of conflict, with Mr Trump calling off air strikes last month minutes before impact.

Britain's seizure of the Iranian tanker is a "clear case of piracy and violation of global law", Majid Takht Ravanchi told the BBC on Wednesday.

"I warn England that you are the initiator of insecurity in seas and you will later understand its repercussions", Rouhani stated, adding that British forces had seized the vessel "unjustly", claiming that the United States had, in fact, seized the tanker "by proxy" through its ally.

Iranian Foreign Minister Javad Zarif, meanwhile, denied the supertanker belonged to Iran, saying whoever owned the oil shipment and the vessel could pursue the case through legal avenues.

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