US offers short-term nuclear deal that would allow Iran to continue enriching uranium In return for these steps, America would ease some economic sanctions, possibly by releasing some of the Iranian foreign exchange reserves currently held in restricted accounts in China, Japan and other countries. In addition, some restrictions affecting Iran's car, petro-chemical and precious metals industries could be eased. Hopes of reaching a "first step" agreement of some kind have risen, with one Western diplomat describing the talks in Geneva on Thursday as "lengthy, constructive and substantial." They were preceded by two days of technical discussion in Vienna by experts from both sides, who focused on the parameters of a freeze to Iran's nuclear programme and the extent of sanctions relief. "The conversation in Vienna was substantive," said another diplomatic source. And some of the things that you might have expected the Iranians to push really hard on, they didn't. The source added that any relief from the sanctions which have severely damaged Iran's economy would be limited until "we were very confident" that a final deal was in reach. "Interim relief would likely give Iran some access to some of its frozen foreign assets, which is a measure that could be turned on and off like a tap, but would not touch the legal structure of sanctions," the source added. Any interim deal along the lines set out above would alarm Congressional hawks in Washington. An agreement as described by the Senate aide falls short of the minimum requirements for a genuine freeze to Iran's nuclear programme laid out by the Institute for Science and International Security, a US think tank. David Albright, the director of ISIS and leading expert on Iran's nuclear ambitions, said Thursday that if Tehran stopped enrichment to 20 per cent and converted its stockpile of this material, this would be "nowhere near enough" to contain the programme. It would only be set back by a "month or two" if all of Iran's 20 per cent enriched uranium was turned into harmless oxide. He added that any interim agreement would be undermined if Iran was still able to manufacture centrifuges, including the old IR-1s and the more advanced IR-2Ms. We're very worried that Iran can continue to make centrifuges, including the IR-2Ms during an interim deal, and then emerge if the deal fell apart with several thousands IR-1s and IR-2Ms to be deployed rapidly in Natanz, and possibly even a third centrifuge plant. Mr Albright added: "I think it is quite reasonable to ask Iran to stop centrifuge manufacturing, but I'm not sure the US is going to go there." The Senate source said the deal as currently outlined would "would neither freeze nor setback" the time Iran would need to "breakout" to make a nuclear weapon. "Since Iran could advance its program to a point of undetectable breakout during the six-month confidence building period, the Senate will have to act immediately to protect America's national security - and that means imposing further sanctions on Iran," said the aide. Congress is currently considering a tough new package of sanctions, which the White House has successfully lobbied to be put on hold pending the outcome of the Geneva talks. "If there is only a 10 per cent chance that additional sanctions would put at risk those negotiations - and quite frankly, we believe it's higher than 10 per cent - we all have an obligation not to take the risk," said a senior administration official.