The Iranian leadership is expected to outline its next step in the dispute over the country’s nuclear programme this morning. Tehran’s ambassador to the UN’s nuclear watchdog said research will continue despite warnings of possible eventual sanctions: “We understand our obligation but at the same time we understand our inalienable right. Inalienable right for the peaceful use of nuclear energy for research and development.”The mood has hardened in Iran with the government threatening to block UN inspections of its facilities if it is referred to the Security Council. The US and the EU fear Iran is trying to develop nuclear weapons. President George Bush and German Chancellor Angela Merkel reflected Europe and America’s joint approach to the problem in their meeting yesterday. The International Atomic Energy Agency meets early next month to consider referring Iran to the Security Council. Its decision could be influenced by developments between now and then, if Iran appears to be taking a less hard line.