Iran and other world powers blamed each other yesterday for the lack of progress in talks on Tehran's nuclear programme.

On the second and final day of talks in Moscow, frustration mounted over the failure to move any closer to ending a decade of negotiations over Iranian work, which the United States and its allies fear is designed for building nuclear weapons.

If talks collapse, nerves could grow on financial markets over the danger of higher oil prices and conflict in the Middle East.

Israel has threatened to bomb Iranian nuclear sites if diplomacy fails to stop Tehran getting the bomb.

An Iranian diplomat said: "We did not come to Moscow only for discussions. We came to Moscow for a resolution.

"But we believe the opposite side is not ready to reach a resolution."

Iran says its nuclear programme has only non-military purposes but the United States, Russia, China, Britain, France and Germany want Tehran to stop enriching uranium to levels that bring it close to acquiring weapons-grade material.

A spokesman for European Union foreign policy chief Catherine Ashton, who is leading the world powers' delegation, admitted the talks over the programme had been intense.