Obama team try to heal Iran rift

The U.S. State Department has been working on drafts of the letter since Obama was elected last November, the report said. It was a response to a letter of congratulations sent by Iranian President Mahmoud Ahmadinejad after Obama's poll victory.

The letter gives assurances that Washington does not want to overthrow the Iranian administration, but instead seeks changes in its behaviour, the paper said. It would be addressed to the Iranian people and sent directly to Supreme Leader Ayatollah Ali Khamenei, or released as an open letter.

In Washington, a State Department official said the policy on Iran was under review and declined to comment on whether a letter was possibly being prepared to send to the Iranians.

"No decision on any specific policy initiative has yet been decided by the State Department," said the official, who spoke on condition of anonymity.

The Guardian said the letter was being considered by Secretary of State Hillary Clinton as part of a review of U.S. policy on Iran. A decision on sending it was not expected until the review was complete.

The United States broke off diplomatic ties with Iran after students seized the U.S. embassy in Tehran following the 1979 revolution.

U.S. suspicions that Iran was trying to develop a nuclear weapon and the presence of thousands of U.S. troops in neighbouring Iraq have been the main hurdles to rebuilding relations in recent years.

The new U.S. administration has said Obama would break with his predecessor by pursuing direct talks with Tehran but has also warned Iran to expect more pressure if it did not meet a U.N. Security Council demand to halt sensitive nuclear work on uranium enrichment.

A close aide to Ahmadinejad told Reuters on Wednesday that Iran would not curtail its nuclear work.

"We have no non-peaceful activities to suspend. All our activities are peaceful and under the supervision of the IAEA," presidential adviser Aliakbar Javanfekr said.