Iran is under pressure to sign the deal, which would see its low-enriched uranium sent to Russia and France for conversion into fuel and sent back to a Tehran reactor monitored by the International Atomic Energy Agency (IAEA).

"We have considered this proposal, we have some technical and economic considerations on that," Iranian Foreign Minister Manouchehr Mottaki told reporters during a visit to the Malaysian capital.

"Two days ago we passed our views and observations to the IAEA, so it is very much possible to establish a technical commission to review and reconsider all these issues," he said, speaking through a translator.

Mottaki, who is attending a conference of developing Muslim nations, did not elaborate on the details of such a technical commission.

The minister said that Iran would "continue enrichment" for nuclear power stations requiring fuel.

He said Iran had three options to obtain fuel for its reactor, which has been operating for 40 years - it could buy fuel from other countries, enrich its uranium itself, or have the fuel processed by another country.

Western powers back the U.N.-drafted deal as the Tehran reactor is an internationally supervised facility, and the deal would remove stocks of low-enriched uranium, a major concern in the West which suspects the enriched material could be further refined for use in nuclear weapons.

Russia's envoy to Tehran Alexander Sadovnikov on Sunday urged Iran to sign on to the fuel deal in a bid to resolve the controversy over its atomic drive, which he said lacked "complete transparency."

"This is not to trick Iran in order to take its low-enriched uranium out of its hands," Sadovnikov said in an interview with the official IRNA news agency.

The proposed agreement has faced stiff opposition from top Iranian officials who say it is a Western sleight of hand aimed at getting the Islamic republic to suspend its uranium enrichment work.

Iran denies Western claims that it is bent on producing nuclear weapons, but the crisis escalated in September, when it and the U.S. revealed the existence of a previously secret nuclear plant at Qom.

U.S. Secretary of State Hillary Clinton has warned Tehran that world powers had limited patience as Iran stalled over offering a categorical response to the proposal.

Asked to comment on Clinton's views, Mottaki replied: "Really?"

From the U.S. point of view, the fuel deal would give Washington and its allies time to negotiate a more far-reaching agreement with Iran, and defuse the nuclear crisis.

The IAEA, the U.N.'s atomic watchdog, said last Thursday it had received an "initial response" from Iran to the deal.