World powers negotiators arrive at the Baghdad International Airport in Iraq, Wednesday, May 23, 2012. Negotiators from the U.S. and five other world powers sat down Wednesday with a team of Iranian diplomats to try to hammer out specific goals in the years-long impasse over Tehran's nuclear program.(AP Photo/Mohammed Ameen, Pool)
World powers negotiators arrive at the Baghdad International Airport in Iraq, Wednesday, May 23, 2012. Negotiators from the U.S. and five other world powers sat down Wednesday with a team of Iranian diplomats to try to hammer out specific goals in the years-long impasse over Tehran's nuclear program.(AP Photo/Mohammed Ameen, Pool)
EU Foreign Policy Chief Catherine Ashton, left, poses for a photo with Iran's Chief Nuclear Negotiator Saeed Jalili in Baghdad, Iraq, Wednesday, May 23, 2012. Negotiators from the U.S. and five other world powers sat down Wednesday with a team of Iranian diplomats to try to hammer out specific goals in the yearslong impasse over Tehran's nuclear program. (AP Photo/Hadi Mizban)
VIENNA (AP) ? Inspectors have located radioactive traces at an Iranian underground bunker, the U.N. atomic agency said Friday in a finding that could mean Iran has moved closer to reaching the uranium threshold needed to arm nuclear missiles.
In a report obtained by The Associated Press, the International Atomic Energy Agency said it was asking Tehran for a full explanation. But the report was careful to avoid any suggestion that Iran was intentionally increasing the level of its uranium enrichment, noting that Tehran said a technical glitch was responsible.
Analysts as well as diplomats who had told the AP of the existence of the traces before publication of the confidential report also said the higher-enriched material could have been a mishap involving centrifuges over-performing as technicians adjusted their output rather than a dangerous step toward building a bomb.
Still, the finding was bound to resonate among the 35 IAEA board members for which the report was prepared, among them the six world powers that had just concluded talks with Iran on its enrichment activities.
The talks left the two sides still far apart over how to oversee Tehran's atomic program but resolved to keep dialogue going as an alternative to possible military action.
The six nations ? the United States, Russia, China, Britain, France and Germany ? are already concerned that Iran is enriching to 20 percent because material at that level can be turned into weapons-grade uranium much more quickly than its main, low-enriched stockpile suitable for nuclear fuel. The higher the enrichment, the easier it becomes to re-enrich uranium to warhead quality at 90 percent. As a result, any finding of traces at 27 percent was likely to spark international interest.
Iran denies any plans to possess nuclear weapons but has for years declined offers of reactor fuel from abroad, including more recent inducements of 20-percent material if it stops producing at that level. The Islamic Republic says it wants to continue producing 20 percent uranium to fuel its research reactor and for medical purposes.
But its refusal to accept foreign offers have increased fears it may want to turn its enrichment activities toward producing such arms. The concerns have been fed by IAEA suspicions that Iran has experimented on components of an atomic arms program ? suspicions Tehran also denies.
The report cited a May 9 letter from Iranian officials suggesting any enrichment at 27 percent at the Fordo enrichment plant in central Iran was inadvertent. The letter said the particles were produced "above the target value" and could have been for "technical reasons beyond the operator's control."
David Albright, whose Washington-based Institute for Science and International Security looks for signs of proliferation, said a new configuration at Fordo means it tends to "overshoot 20 percent" at the start.
"Nonetheless, embarrassing for Iran," he wrote in an email to the AP.
Others were more skeptical.
"It's not surprising because they have the technology. Iran doesn't intend to stop its nuclear weapon program, and the fact that they are at 27 percent shows the Iranian intentions," said a senior Israeli defense official who spoke on condition of anonymity because he is not allowed to speak with the media.
International concerns have increased since Iran started higher enrichment at Fordo, which is carved into a mountain to make it impervious to attack. Israel and the United States have not ruled out using force as a last option if diplomacy fails to curb the Islamic Republic's nuclear program.
Iran already has about 700 centrifuges churning out 20-percent enriched uranium at Fordo. The report noted that although Iran has set up about 350 more centrifuges since late last year at the site, these machines are not enriching.
While the reason for that could be purely technical, it could also be a signal from Tehran that it is waiting for progress in the negotiations.
The IAEA report also detailed some progress in separate talks between the U.N. nuclear agency and Iran that the agency hopes will re-launch a long-stalled probe into the suspicions that Tehran has worked on nuclear-weapons related experiments.
The latest attempt to persuade Iran to compromise ended inconclusively Thursday at a meeting in Baghdad. At the talks, the six world powers failed to persuade Tehran to freeze its 20 percent enrichment. Envoys said the group will meet again next month in Moscow.
Iran went into the Baghdad talks urging the West to scale back on recently toughened sanctions, which have targeted Iran's critical oil exports and have effectively blackballed the country from international banking networks. The 27-nation European Union is set to ban all Iranian fuel imports on July 1, shutting the door on about 18 percent of Iran's market.
Saeed Jalili, Iran's top nuclear negotiator, offered a lukewarm assessment of the latest negotiations, in light of European and American refusal to lift tough sanctions against Iran as Tehran had hoped.
"The result of the talks was that we were able to get more familiar with the views of each other," Jalili told reporters.
European diplomats focused on the positives.
"It is clear that we both want to make progress and that there is some common ground," European Union foreign policy chief Catherine Ashton, who led the Baghdad talks, told reporters. "However, significant differences remain. Nonetheless, we do agree on the need for further discussion to expand that common ground."
But in Washington, Secretary of State Hillary Rodham Clinton said significant differences remain between the two sides and that it's now up to Iran "to close the gaps."
"Iran now has the choice to make: Will it meet its international obligations and give the world confidence about its intentions or not?" Clinton said.
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AP writer Ian Deitch in Jerusalem contributed this report.
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