VIENNA - Iran and world powers on Saturday gave themselves some four more months, until November 24, to negotiate a historic nuclear deal after failing to close major gaps in marathon talks in Vienna.
"While we have made tangible progress on some of the issues and have worked together on a text (for a deal) ... there are still significant gaps on some core issues," lead negotiator and EU foreign policy chief Catherine Ashton said.
In a statement repeated in Farsi by Iranian Foreign Minister Mohammad Javad Zarif, Ashton said the parties would "reconvene in the coming weeks ... with the clear determination to reach agreement ... at the earliest possible moment".
In November last year, Iran and the five permanent members of the UN Security Council plus Germany agreed an interim deal under which Iran froze certain nuclear activities for six months in return for some sanctions relief.
This expires on July 20, but the parties had given themselves the option to push back this deadline if they failed during the six months to transform the interim deal into a lasting accord.
US Secretary of State John Kerry, who himself this week spent days in Vienna trying to broker a breakthrough, said Friday the "short extension" was "warranted by the progress we've made and the path forward we can envision".
"While we've made clear that no deal is better than a bad deal, the very real prospect of reaching a good agreement that achieves our objectives necessitates that we seek more time," Kerry said in a statement.
The mooted deal would ease fears that Iran would develop nuclear weapons after a decade of atomic expansion by Tehran, rising tensions, failed diplomacy and threats even of war.
Iran denies seeking the atomic bomb and wants the lifting of crippling UN and Western sanctions.
The deal they are seeking is highly ambitious and fiendishly complex.
The six powers want Iran to dramatically reduce in scope its nuclear programme for a lengthy period of time and agree to more intrusive UN inspections.
This would greatly expand the time needed for the Islamic republic to develop a nuclear weapon, should it choose to do so, while giving the world ample warning of any such "breakout" push.
The two sides are believed to have narrowed their positions in recent weeks on a few issues such as the Arak reactor, which could give Iran weapons-grade plutonium, and enhanced inspections.
But they remain far apart on the key issue of Iran's capacities to enrich uranium, a process which can produce fuel for reactors but also the core of a nuclear bomb.
Unlocking of funds
Kerry said on Friday that under the terms of the new extension, Washington would unblock some $2.8 billion (S$3.47 billion) in frozen Iranian funds.
In return Iran's partial nuclear freeze would continue and it will take further steps including turning medium-enriched uranium into reactor fuel.
"Once the ... material is in fuel form, it will be very difficult for Iran to use this material for a weapon in a breakout scenario," Kerry said.
"Let me be clear: Iran will not get any more money during these four months than it did during the last six months, and the vast majority of its frozen oil revenues will remain inaccessible," he said.
"And, just as we have over the last six months, we will continue to vigorously enforce the sanctions that remain in place."
The US and Iranian governments will continue to come under severe domestic pressure as they seek to use the next four months to forge a deal.
US lawmakers, who are widely supportive of Iran's arch enemy Israel, have threatened to ramp up sanctions without what they see as a sufficiently rigorous agreement.
Iran's negotiators in turn face pressure from hardliners, who view the United States as the ultimate enemy and oppose any agreement seen as a concession.
Israel, the Middle East's sole if undeclared nuclear armed state and which has refused to rule out military action, is opposed to any enrichment by Iran at all.
"Progress has been achieved in several areas, but gaps remain on several issues. Negotiators will need time and flexibility from political leaders in their capitals," said Kelsey Davenport at the Arms Control Association.