Iran is considering a Russian proposal to halt the expansion of its nuclear program in order to avert new sanctions, the country’s envoy in Moscow said.

“We need to study this proposal and to establish on what basis it has been made,” Ambassador Mahmoud-Reza Sajjadi said in an interview at the Iranian embassy in Moscow today. The Russian plan, announced by Deputy Foreign Minister Sergei Ryabkov last week, would allow Iran to avoid a European Union ban on its crude that is scheduled to come into force in July.

Iran will ensure it maintains its right to produce nuclear energy, Sajjadi said. The U.S. and European Union allege Iran is seeking to build a bomb, not just make fuel for electricity production and medical research, as the country insists.

The EU is planning on July 1 to impose an embargo on crude from Iran, which accounts for about 4 percent of the world’s supply, as it works with the U.S. to ratchet up pressure on the Persian Gulf state. Oil prices retreated from a one-week high, dropping more than $1 today on the report.

The U.S. and EU have imposed financial sanctions on Iran and are pressuring nations including China to buy less of its oil as they seek to curtail its nuclear activities.

Ryabkov, who leads Prime Minister and President-elect Vladimir Putin’s delegation to international talks over the dispute, said the Russian proposal would be the first in a series of mutual concessions designed to end in a final accord that would remove suspicions about Iranian intent regarding atomic weapons.............