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Iranian President Mahmoud Ahmadinejad inspects a uranium-enrichment facility south of Tehran in 2008.

Credible new evidence suggests Iran is secretly building nuclear warheads, the United Nations nuclear agency says, laying out the most damning case yet that Tehran is seeking to join the tiny clutch of nuclear-armed powers.

"Credible … information indicates that Iran has carried out activities relevant to the development of a nuclear explosive device," the International Atomic Energy Agency reported Tuesday. It was a powerful indictment of Tehran's nuclear program that its Islamic rulers have long claimed was solely for peaceful, power-generating purposes.

Instead, the IAEA found evidence of weapons-related research entirely incompatible with power generation. Efforts to create computer models of nuclear blasts, to build the powerful detonators needed to initiate a nuclear explosions and vital miniaturization efforts needed to fit a nuclear warhead inside a missile nosecone were all uncovered.

The report, based on intelligence fed to the agency by member states, supports long-held suspicions that Tehran has a clandestine nuclear-weapons program.

The long-awaited report triggered a firestorm of speculation about pre-emptive Israeli or American strikes to destroy Iran's nuclear-weapons' program before it was too late.

"War is not a picnic. … We don't want a war," Israeli Defence Minister Ehud Barak said, adding "[Israel]has not yet decided to embark on any operation."

Earlier this year, U.S. President Barack Obama controversially shipped Israel the "bunker-buster" bombs it has sought to be able to strike deeply buried facilities.

Russia warned against any military action.

However, whether the new IEAE report will prod the UN Security Council into slapping Iran with really tough sanctions remains unclear. Russia and China, both veto-wielding permanent members of the Security Council, have thwarted very tough sanctions in the past.

The flurry of speculation about pre-emptive strikes also provoked dark warnings of retaliation from Iranian leaders.

"If America wants to confront the Iranian nation, it will certainly regret the Iranian nation's response," Iranian President Mahmoud Ahmadinejad said.

Any Israeli strike against Iran would be far more difficult than the single target attacks its warplanes flew against an Iraqi reactor in 1981 and a Syrian one in 2007. Iran's widely dispersed and often deeply buried nuclear facilities would require days – perhaps weeks – of repeated attacks; a war rather than a raid. And given U.S. control of airspace over Iraq and the Persian Gulf, no Israeli attack could occur without at least tacit U.S. approval.

But the report detailing Iran's nuclear progress also suggests that the 2010 cyber attack using the Stuxnet worm – which infiltrated and destroyed sensitive Iranian centrifuges used to enrich uranium to weapons-grade levels – may have delayed, but didn't derail, the program.

Nevertheless, the report sets the stage for a new confrontation – perhaps non-military – between the international community and Iran.

The IAEA "has become increasingly concerned about the possible existence in Iran of undisclosed nuclear related activities involving military related organizations, including activities related to the development of a nuclear payload for a missile," the report says. Iran already has tested missiles capable of lofting nuclear warheads to Jerusalem and parts of Europe but, so far, there is no evidence that it has miniaturized a warhead to fit.

"The facts lay out a pretty overwhelming case that this was a pretty sophisticated nuclear weapons effort aimed at miniaturizing a warhead for a ballistic missile," David Albright, a U.S. expert in nuclear proliferation, told Reuters.

Aside from the five signatories of the nuclear Non-Proliferation Treaty – Britain, France, China, Russia and the United States – no other nation can lawfully deploy nuclear warheads. But proliferation has plagued the planet for decades, ever since India, using Canadian-supplied technology, joined the nuclear weapons circle in 1974. Pakistan has also proved itself a nuclear-armed state by deploying and testing warheads. Israel also has a nuclear arsenal.