The Iranian flag flutters in front the International Atomic Energy Agency (IAEA) headquarters in Vienna, Austria July 10, 2019.
The Iranian flag flutters in front the International Atomic Energy Agency (IAEA) headquarters in Vienna, Austria July 10, 2019. Reuters / Lisi Niesner

Iran said on Monday it would not be dictated to by foreign interests, after Russia appeared to link efforts to revive a deal over its nuclear programme to sanctions over Ukraine, which Moscow's envoy to Tehran called a misunderstanding.

A deal over reviving Iran's 2015 pact with world powers seemed close, all parties to negotiations in Vienna said on Friday after months of indirect talks between Tehran and Washington

But Russian Foreign Minister Sergei Lavrov added uncertainty on Saturday, saying Moscow wanted a written U.S. guarantee that its trade, investment and military-technical cooperation with Iran would not be hindered by Western sanctions imposed since it invaded Ukraine.

Iran's Foreign Minister Hossein Amirabdollahian said Tehran would not allow "any foreign elements to undermine its national interests", Iran's state media reported, while the foreign ministry said it awaited an explanation from Russia.

The Iranian semi-official news agency Tasnim quoted Moscow's Ambassador to Tehran Levan Dzhagaryan as saying that Russia - which France on Monday warned not to resort to blackmail over efforts to revive the deal - planned to give Iran an explanation of the guarantees it has requested from the United States.

Asked about Lavrov's statement about linking Ukraine sanctions to the nuclear pact, Dzhagaryan told Tasnim "there is a misunderstanding in this regard." He did not elaborate.

Oil prices hit their highest since 2008 on Monday amid market supply fears as the United States and European allies considered banning Russian oil imports and prospects for a swift return of Iranian crude to global markets receded.

'TRYING IT ON'

Progress has been made towards restoring the pact to curb Tehran's nuclear programme in exchange for sanctions relief, which the United States abandoned in 2018. But diplomats told Reuters that key issues remained unresolved between Tehran and Washington, including the extent to which sanctions would be rolled back. .

Western officials say there is common interest in avoiding a non-proliferation crisis, and they are trying to ascertain if what Russia is demanding regards only its commitments to the Iran deal. That would be manageable, but anything beyond that would be problematic, they say.

A French presidency official urged Russia to assess what was at stake in Vienna, "that is to say Iran's return to respecting its obligations under the JCPOA," referring to the 2015 deal by its formal name, the Joint Comprehensive Plan of Action.

"Because otherwise, in reality, it's just blackmail and not diplomacy," he told reporters.

A European diplomat added: "The Russians are really trying it on and the Iranians aren't happy although of course not saying too much publicly. We're trying to find a way through."

European negotiators have temporarily left the talks as they believe they have gone as far as they can and it is now up to the two main protagonists to agree, three diplomats said.

Iran's top security official, Ali Shamkhani, called on Washington on Monday to make political decisions.

"Priority of Iranian negotiators is to resolve remaining issues that are considered (a)... red line. Rapid access to a strong deal requires new initiatives from all parties," Shamkhani tweeted.

Russia's concerns about the impact of Western sanctions on its dealings with Iran follow a push by senior Iranian officials for deeper ties since hardliner Ebrahim Raisi became president last year.

Iran's top authority, Supreme Leader Ayatollah Khamenei, has called for closer ties with Russia due to his deep mistrust of the United States.

(Writing by John Irish and Parisa HafeziEditing by Tom Hogue, Michael Georgy and John Stonestreet)