The United States, Russia, China, Britain, France and Germany want a long-term agreement on the permissible scope of Tehran's nuclear activities to lay to rest concerns that they could be put to developing atomic bombs. Tehran's priority is a complete removal of damaging economic sanctions against it.
The negotiations will probably extend at least over several months, and could help defuse years of hostility between energy-exporting Iran and the West, ease the danger of a new war in the Middle East, transform the regional power balance and open up major business opportunities for Western firms.
"The talks are going surprisingly well. There haven't been any real problems so far," a senior Western diplomat said, Reuters reported.
The opening session on Tuesday was "productive" and "substantive", they said. "The focus was on the parameters and the process of negotiations, the timetable of what is going to be a medium- to long-term process," one European diplomat said.
"We don't expect instant results."
A Wednesday morning session was chaired by EU foreign policy deputy chief Helga Schmid and Iranian Deputy Foreign Minister Abbas Araqchi, accompanied by senior diplomats from the six powers.
EU foreign policy chief Catherine Ashton, who coordinates official contacts with Iran on behalf of the six, was scheduled to attend an extraordinary meeting of EU foreign ministers in Brussels on the Ukraine crisis on Thursday afternoon.
The current Iran talks had originally been expected to run for at least full three days but might be adjourned as early as Thursday morning due to the escalating situation in Ukraine, according to Western diplomats.
The six powers have yet to spell out their precise demands of Iran. But Western officials have signaled they want Iran to cap enrichment of uranium at a low fissile purity, limit research and development of new nuclear equipment and decommission a substantial portion of its centrifuges used to refine uranium.
Araqchi stressed on Tuesday that any dismantling of Iranian nuclear installations would not be up for negotiation.
The talks could also stumble over the future of Iran's facilities in Arak, an unfinished heavy water reactor in Central Iran, and the Fordow uranium enrichment plant.
"Iran's nuclear sites will continue their activities like before," Atomic Energy Organisation of Iran (AEOI) Spokesman Behrouz Kamalvandi said on Tuesday.
During a decade of on-and-off dialogue with world powers, Iran has rejected Western allegations that it has been seeking a nuclear weapons capability. It says it is enriching uranium only for electricity generation and medical purposes.
As part of a final deal, Iran expects the United States, the European Union and the United Nations to lift economic sanctions on the oil-dependent economy. But Western governments will be wary of giving up their leverage too soon.
Ahead of the talks, both sides said getting to a deal would be a "complicated, difficult and lengthy process".
"When the stakes are this high, and the devil is truly in the details, one has to take the time required to ensure the confidence of the international community in the result," the official said. "That can't be done in a day, a week, or even a month in this situation."
On the eve of the Vienna round, both sides played down anticipation of early progress, with Iran's Supreme Leader Ayatollah Ali Khamenei saying he was not optimistic.
The six powers hope to get a deal done by late July, when an interim accord struck in November expires.
That agreement obliged Tehran to suspend higher-level enrichment in return for some relief from economic sanctions.
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