Ten months after US President Barack Obama set a year-end deadline for Iran to engage with world powers on its nuclear program, the government in Tehran has failed to respond.
The Obama administration now wants to carefully target sanctions at the regime - both to avoid alienating the Iranian public and to keep the door ajar to a resolution of the struggle over Iran's nuclear program, US officials told The Washington Post.
The aim of the sanctions would be to force the Tehran government to the negotiating table, rather than to punish it for either its apparent push to develop a nuclear weapon or its treatment of its people, the report said.
"We have never been attracted to the idea of trying to get the whole world to cordon off their economy," a senior US official told the paper. "We have to be deft at this, because it matters how the Iranian people interpret their isolation - whether they fault the regime or are fooled into thinking we are to blame."
Authorities also arrested the sister of Nobel peace laureate Shirin Ebadi as the embattled regime stepped up efforts to suppress a resurgent opposition yesterday. Unable to arrest Dr Ebadi - who regularly denounces the regime from exile in Europe - the regime sent four intelligence agents to seize her sister, Nooshin, a doctor, from her home.
Mr Obama and British Foreign Secretary David Miliband signalled strong support for Iranian demonstrators. Mr Obama's comments were his strongest words of support yet for the protesters. Until now, the Obama administration, along with other Western powers, has kept criticism muted so as not to further complicate the nuclear talks.
The biggest roadblock in the negotiations has been Tehran's refusal to agree to an International Atomic Energy Agency-brokered deal to ship much of Iran's uranium to Russia, where it would be further enriched and sent back for use in a medical-research reactor.
After Iranian negotiators appeared to agree to the deal, Iranian officials baulked at signing, issuing a series of sometimes-contradictory demands for alterations.
Iranian Foreign Minister Manouchehr Mottaki yesterday said his country was willing to produce and enrich the uranium needed for the medical reactor itself.
Appearing to turn the tables on Western powers, he said it was Iran that was waiting for a response to its counterproposal to the IAEA-brokered proposal.