Iran has halted oil shipments to Britain and France, the Oil Ministry said today, in an apparent pre-emptive blow against the European Union after the bloc imposed sanctions on Iran's crucial fuel exports.

A statement posted on the ministry's shana.ir website gave no other details, but it follows a flurry of contradictory signals by Iran about a backlash against the EU for imposing a boycott on Iranian oil beginning in July.

The 27-nation EU accounts for about 18% of Iran's oil exports.

Ministry spokesman Ali Reza Nikzad-Rahbar said the suspension posed no problems for Iran.

"We have our own customers and replaced British and French companies with other firms," he was quoted as saying by the IRNA state news agency.

Last week, state media said Iran was planning to cut off oil exports to six EU nations, including France, but later reports said the nations were only told that Iran has no problem finding replacement customers for the European shipments.

The EU sanctions, imposed last month, were part of Western efforts to target Iran's critical oil sector in attempts to rein in Tehran's nuclear programme

Earlier diplomats said Iran was poised to greatly expand uranium enrichment at a fortified underground bunker to a point that would boost how quickly it could make nuclear warheads.

They said Tehran had put finishing touches for the installation of thousands of new-generation centrifuges at the cavernous bunker - machines that can produce enriched uranium much more quickly and efficiently than its present machines.

While saying that the electrical circuitry, piping and supporting equipment for the new centrifuges was now in place, the diplomats emphasised that Tehran had not started installing the new machines at its Fordo facility and could not say whether it was planning to.

The reported work at Fordo appeared to reflect Iran's determination to forge ahead with nuclear activity that could be used to make atomic arms despite rapidly escalating international sanctions and the latent threat of an Israeli military strike on its nuclear facilities.

Fordo could be used to make fissile warhead material even without such an upgrade, the diplomats said.

They said that although older than Iran's new generation machines, the centrifuges now operating there can be reconfigured within days to make such material because they already are enriching to 20% - a level that can be boosted quickly to weapons-grade quality.

In contrast, Iran's older enrichment site at Natanz is producing uranium at 3.4%, a level normally used to power reactors. While that too could be turned into weapons-grade uranium, reassembling from low to weapons-grade production is complex, and retooling the thousands of centrifuges at Natanz would probably take weeks.

The diplomats' comments come as International Atomic Energy Agency inspectors are due to visit Tehran today. Their trip - the second this month - is another attempt to break more than three years of Iranian stonewalling about claims that it has - or is - secretly working on nuclear weapons that would be armed with uranium enriched to 90% or more.

Diplomats accredited to the IAEA expect little from that visit. They said that - as before - Iran was refusing to allow the agency experts to visit Parchin, the suspected site of explosives testing for a nuclear weapon and had turned down other key requests made by the experts.

Iranian officials deny nuclear weapons aspirations, saying the claims are based on bogus intelligence from the US and Israel.

More recently, the US, the European Union and other Western allies have either tightened up their own sanctions or rapidly put new penalties in place striking at the heart of Iran's oil exports lifeline and its financial system.

The most recent squeeze on Iran was announced on Friday, when Brussels-based Swift, a financial clearing house used by virtually every country and major corporation in the world, agreed to shut out the Islamic Republic from its network.

The next round of talks between Iran and six world powers on the country's nuclear program will be held in Istanbul.

The last round of talks between Iran and the five permanent members of the UN Security Council plus Germany were held in Istanbul in January 2011 but ended in failure.

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