Under pressure from other countries, weakened politically and short on options, US President George W. Bush dropped longstanding demands and rhetoric to unite world powers on Iran.

But how will he ever hold them together?

His challenge: to keep the six-member group intact while navigating a treacherous course either toward engagement with Iran, Washington's arch-foe for 26 years and the fourth largest oil exporter, or conflict over Tehran's nuclear ambitions.

Years after branding Iran a part of the "axis of evil" and while still calling it a prime sponsor of terrorism, the administration has abandoned its refusal to talk directly to Tehran on the nuclear issue and reined in its threats.

As a result the United States, Russia, France, China and Britain — the UN Security Council's five permanent members — plus Germany agreed last week in Vienna to reward and punish Iran with measures to be outlined in Tehran today.

The plan is to persuade Iran to jettison a nuclear program the United States and its allies says is to produce weapons and Tehran insists aims only to produce energy.

Critics of the Bush action in the United States fear the offer will lead Washington to make other concessions, such as allowing Iran to maintain a small-scale nuclear research and development operation on its territory.

But several analysts believe the administration had no choice but to talk to Tehran.

"Iran certainly feels it's negotiating from a position of strength" and the administration could not win major-power support for eventual sanctions or possibly even military action without first exhausting the negotiations option, said Ray Takeyh of the Council on Foreign Relations.

Even as it embraces diplomacy, a deeply worried administration is hedging its bets.

It has set strict terms for negotiations, requiring Iran to first suspend all nuclear enrichment-related and reprocessing activities.

Senior US officials say they also will go on pursuing financial and defensive restraints on Iran — like urging banks to limit lending — undeterred by whatever happens in negotiations or the Security Council.

Meanwhile, they recite the mantra that no US president can ignore: that all options, including military force, remain on the table — even as US forces are tied up in Iraq.

Bush has said he will not allow Iran, whose President Mahmoud Ahmadinejad has called for Israel's destruction, to obtain a nuclear weapon. Washington and many of its allies believe Tehran's programme is accelerating ominously.

Although Director of National Intelligence John Negroponte predicted Iran may not have a nuclear weapon until 2010, Secretary of State Condoleezza Rice has focused on Tehran's assertion it will have a 3,000-centrifuge cascade for enriching uranium by year's end.

Endeavouring to secure critical support from Russia and China, which have opposed tough action against Iran, the United States deferred passage of a Security Council resolution and tempered the resolution's language.

Regardless of how Iran responds to the package, US officials say maintaining major-power unity will be tough. At a minimum, Iran will seek to split the group by pressing the broadest definition of "suspension" and leaning on Russia and China to oppose sanctions, experts say. — Reuters