- Israel urges P5+1 powers to show "determination, not weakness" with Iran
- The IAEA chief says meetings will positively impact upcoming talks, Iran says
- Both sides offered proposals to expand cooperation, Iran says
- NATO countries say they share "serious concern" about Iran
Iran's talks Monday with the United Nations nuclear watchdog agency helped lay the groundwork for progress in upcoming negotiations, the Iranian regime said.
International Atomic Energy Agency Director General Yukiya Amano said after the meetings that they will have a positive impact on Iran's talks Wednesday with key world powers, state-run Press TV reported.
The IAEA did not immediately release a transcript of Amano's remarks.
Amano met with Iran's top negotiator, Saeed Jalili, among others.
"During the meeting (with Jalili), we discussed a wide spectrum of different issues, including nuclear disarmament, peaceful use of nuclear energy and strengthening (the position of) the agency." Amano said, according to Press TV.
State-run news agency IRNA said that in meetings, both sides "discussed present problems more candidly, providing each other with proposals to remove ambiguities and expand cooperation."
IRNA also said Germany was holding talks with Iran "on likely confidence-building measures" ahead of Wednesday's negotiations in Baghdad.
The IAEA has been pushing Iran for greater transparency amid growing concerns that the country could be working on building nuclear weapons, despite its insistence that its nuclear program is for peaceful purposes. The trip by Amano, accompanied by two other top IAEA officials, raises speculation that Iran may be willing to grant inspectors access to key nuclear sites.
Iranian Foreign Minister Ali Akbar Salehi said he had invited Amano to visit Iran last year, according to IRNA.
The talks come at a critical time for Iran. The country's economy has been crippled by sanctions imposed by the United Nations, the United States and the European Union -- and since 80% of Iran's foreign revenues are derived from oil exports, and an embargo by the EU set to go into effect in July will put further pressure on its economy.
But the country's finance minister, Shamseddin Hosseini, told CNN's "Fareed Zakaria GPS" that the embargo would also likely hurt the EU, which is grappling with its own weakened economy.
"We must pay close attention when we speak of oil revenues and sanctions against oil sales. Who are the winners and the losers of such sanctions?" Hosseini said.
"Indeed, it is difficult. But not just for Iran. And we can all rest assured that there will be a considerable increase in international oil market prices. Now, is this the best approach?"
Oil prices as a result of the sanctions, he said, "will go considerably higher than $100 per barrel."
"Even the IMF (International Monetary Fund) says that as a result of these sanctions, oil prices will perhaps reach and hover around $160 per barrel. And the decrease in financial and economic output in Europe will truly be felt," Hosseini added.
It was not clear exactly what Hosseini was referring to. But in March, IMF chief Christine Lagarde said oil prices could spike as much as 30% if Iran's crude oil exports fell sharply, and it would take time for other exporters to adjust their outputs.
During the height of tensions, oil prices soared to $110 a barrel. The price per barrel of crude oil finished last week at $92.50 per barrel.
Iran met with the IAEA for the first time in three months in Vienna, Austria, last week.
This week's meeting in Baghdad is a follow-up to last month's talks between Iran and the so-called P5+1: the United States, France, Russia, China, Britain -- the five permanent members of the U.N. Security Council -- and Germany.
Tensions over Iran's nuclear program have roiled the Middle East, with Iran threatening earlier this year to close the Strait of Hormuz, a vital oil shipping lane, if sanctions were imposed on its exports of crude oil.
Meanwhile, Israel, which is believed to have its own nuclear arsenal, has said it may attack Iran to prevent it from developing nuclear weapons. Prime Minister Benjamin Netanyahu, who has repeatedly raised alarms about Iran's nuclear development, said Monday that the world's leading powers "must show determination, not weakness" in the upcoming talks.
"They do not need to make concessions to Iran," Netanyahu said in remarks distributed by his office. "They need to set clear and unequivocal demands before it."
Israel wants Iran to halt all uranium enrichment, give up all nuclear fuel it has enriched so far and dismantle the Fordo enrichment plant it built into a mountainside.
"Only thus will it be possible to ensure that Iran will not have a nuclear bomb," Netanyahu said.
But Israeli Foreign Minister Avigdor Lieberman said Sunday, "We don't see any readiness from the Iranian side to give up their nuclear ambitions." He added that Israel would wait to see the outcome of negotiations.
NATO weighed in as well. In a statement from the NATO summit in Chicago, the participating heads of state issued a declaration focusing on numerous issues, including Iran.
"We share the United Nations Security Council's serious concern with Iran's nuclear program and call upon Iran to fully comply with all its international obligations," the statement said.
"We further call upon Iran to cooperate with the international community to build confidence in the exclusively peaceful nature of its nuclear program in compliance with its NPT (Nuclear Non-proliferaition Treaty) obligations. We support the immediate resolution of the Iranian nuclear issue through diplomatic means and encourage a sustained process of engagement within the format of the P5+1 and Iran talks."
In March, the IAEA noted what it called a sharp and troubling increase in Iran's uranium enrichment capabilities.
Leaders of the so-called Group of Eight -- United States, Canada, the United Kingdom, Germany, France, Italy, Japan and Russia -- called Saturday on Iran to comply with the requirements of the IAEA and open its doors to nuclear inspectors.
In a declaration, the G8 leaders said they welcomed the resumption of talks.
The leaders called on Iran to engage "in detailed discussion about near-term, concrete steps that can, through a step-by-step approach based on reciprocity, lead towards a comprehensive negotiated solution which restores international confidence that Iran's nuclear program is exclusively peaceful," according to the declaration.
The G8 leaders also urged Iran to comply with international obligations to uphold human rights and fundamental freedoms, including the freedom of religion.