Diplomats pessimistic over Iranian crisis

They believe the Islamic republic's hardline rulers have decided to work all-out to acquire a nuclear deterrent -- be that a bomb or the capacity to make one -- which will in turn accelerate Western efforts to impose punitive action such as UN sanctions in the short term.

Many diplomats also say that, barring a sudden and surprise change of heart by Tehran's radical right-wingers, a conflict between Iran and the United States cannot be ruled out in the medium term.

"The Iranians believe they are in a very, very strong position. They're counting on the Russians and Chinese to block the Security Council from imposing any meaningful sanctions," a senior Tehran-based Western diplomat said.

"But the regime also seems convinced the Americans cannot attack," he added.

Iranian officials regular speak of the US as being in a "quagmire" in Iraq and allergic to any further spike in oil prices, already at 75 dollars a barrel partly thanks to the Iran crisis.

"This, I think, is a very grave miscalculation," said the diplomat, speaking on condition that he not be named.

The UN Security Council has given Tehran until April 28 to freeze uranium enrichment -- which makes reactor fuel but can be extended to make weapons -- as a "confidence-building" measure.

Iran's has refused to do so, asserting its nuclear drive is a legal bid to generate atomic energy.

It has also announced that its scientists have successfully mastered enrichment and -- in a display of total defiance -- has vowed to reach an industrial-scale enrichment capacity within 12 months.

"The Iranians have tried to present a fait accompli. In reality they're not quite there yet, but it is a turning point. From now on the faster their work advances, the quicker the crisis will escalate," said a European diplomat close to the issue.

Furthermore, Iran's hardline President Mahmoud Ahmadinejad has been firing on all cylinders -- upping his fierce anti-Israeli rhetoric and showing off Tehran's close ties with Palestinian and Iraqi militant groups.

Iran's armed forces have also played up military exercises in the Gulf and the oil-supply choke point at the Strait of Hormuz.