'Major Problems' as Kerry Heads to Iran Nuclear Talks

Efforts to finalize a historic nuclear deal with Iran remain stuck on several issues, diplomats from both sides said Friday as U.S. Secretary of State John Kerry headed to Vienna for crunch weekend talks.

"Some major problems exist which are still blocking the work... but in other areas we have made good progress," Iranian Deputy Foreign Minister Abbas Araghchi told state television from the Austrian capital, four days before a deadline for a deal.

"Overall, the work is moving ahead slowly and with difficulty," he added, without going into details.

This was echoed by a Western diplomat involved in the talks, who said that several key issues including future U.N. inspections and the timing of sanctions relief remain "extremely problematic."

"The most difficult issues need to be resolved in the coming days: transparency, inspections, PMD (possible military dimensions of Iran's nuclear program), sanctions... On the major issues there is major disagreement," the diplomat said.

The envoy, speaking on condition of anonymity, said that the June 30 deadline may be missed but only by a few days, echoing comments from other figures.

Iran's IRNA news agency meanwhile quoted a source as saying that the remaining gaps "all involve issues of substantial and essential divergence".

The P5+1 -- the United States, China, Russia, Britain, France and Germany -- want Iran to curtail its nuclear activities in order to make any push to make nuclear weapons all but impossible.

The deal, it is hoped, would put an end to a standoff dating back to 2002 that has threatened to escalate into armed conflict and poisoned the Islamic republic's relations with the international community.

In return for downsizing its activities and allowing closer U.N. inspections, Iran, which denies wanting nuclear weapons, would see painful U.N. and Western sanctions that have choked its economy lifted.

In April the P5+1 and Iran massively raised hopes that a resolution to the long-running crisis was in sight when they reached an accord in Lausanne, Switzerland on the outlines of a deal, aiming to finalize it by the end of this month.

But on Tuesday Iran's supreme leader, Ayatollah Ali Khamenei, set out key "red lines" for the final agreement which appeared to go against parts of what had been agreed in the Swiss lakeside city.

Khamenei said that all economic and financial sanctions imposed by the U.N. Security Council and the U.S. must be lifted on the same day that an agreement is signed.

Western powers have said that no sanctions will be lifted until the U.N. atomic watchdog has verified that Iran has taken key steps outlined in the deal.

These include Iran slashing by more than two-thirds the number of uranium enrichment centrifuges, which can make fuel for nuclear power but also the core of a nuclear bomb, and shrinking its uranium stockpile by 98 percent.

Also Iran agreed to change the design of a planned reactor at Arak so that it cannot produce weapons-grade plutonium and to no longer use its Fordo facility -- built into a mountain to protect it from attack -- for uranium enrichment.

In addition Khamenei took issue with the IAEA visiting military sites -- vital for a U.N. probe into allegations of past efforts to develop nuclear weapons -- and with the time periods for which Iran will halt certain activities.

- 'Whack-a-mole' -

Even if negotiators manage a deal, it will be closely scrutinized by hardliners both in Iran and the United States, as well as Iran's regional rivals Israel, widely assumed to have nuclear weapons itself, and Saudi Arabia.

On Wednesday Kerry, expected to meet Iranian Foreign Minister Mohammad Javad Zarif on Saturday in Vienna, warned that despite the huge diplomatic effort to get a deal -- talks began in earnest back in 2013 -- success was not guaranteed.

If Iran cannot address the remaining issues needed to assure the world its nuclear program is peaceful, "there won't be a deal," he said.

On Thursday a senior U.S. official said that the key unresolved points in what will be a highly complex accord included the timing and pace of sanctions relief and details about access and transparency for U.N. inspectors.

"These negotiations have been extremely tough," the official said. "It is like (the game) whack-a-mole. Another issue may pop back up because you've changed the balance of the deal because of any decision."