By agreeing to ship some uranium to Turkey, Iran has not removed the case for further UN nuclear sanctions, western diplomats close to the UN atomic watchdog said on Monday.
"They're not in trouble over the TRR (Tehran Research Reactor) deal. So fixing the refuelling for that reactor is not going to put them straight in the eyes of the international community," one diplomat said, speaking on condition of anonymity.
Iran is already under three sets of UN sanctions for refusing to halt its uranium enrichment, which the West fears hides a covert nuclear weapons programme. Tehran insists it will go ahead with enrichment, even after signing the fuel deal.
"It was Iran in the first place who approached the IAEA (International Atomic Energy Agency) because they needed the fuel," another diplomat said.
"They need that fuel, but they've held out on a deal for eight months now. They're not under sanctions over the TRR. They're under sanctions for refusing to halt uranium enrichment, people shouldn't forget that."
Iran announced that it had signed an agreement with Brazil and Turkey, whereby it would ship 1,200 kilogrammes (2,640 pounds) of low-enriched uranium (LEU) to Turkey in return for fuel for a reactor in Tehran that makes radioisotopes for cancer treatment.
The deal appeared to mark a breakthrough in long-stalled discussions over the refuelling of the research reactor.
The IAEA has been trying to persuade Iran since October to sign a deal with the United States, France and Russia that would see its stockpile of low enriched uranium shipped out of the country and then turned into fuel for the research reactor.
But Iran had stalled on the deal, insisting it wants to keep the uranium on its own soil for a simultaneous swap with reactor fuel.
Uranium enrichment is at the centre of western suspicions over Tehran's atomic programme, because in a highly purified form it can be used to make the fissile material of a nuclear bomb.
Under the new agreement, signed by Iran, Turkey and Brazil and a copy of which was obtained by AFP, Tehran is ready to deposit 1,200 kg of low enriched uranium "within one month".
In return, the United States, France and Russia would deliver 120 kg of fuel required for the reactor "in no later than one year".
A western diplomat noted that Iran had carried on enriching uranium, thereby increasing its stockpile of LEU since the IAEA brokered its original plan last October.
At the time of its last report on Iran in February, the UN watchdog calculated that Iran had stockpiled 2,065 kg of LEU.
"They've carried on enriching and have now amassed more than 2,000 kg of LEU, so even if they've agreed to ship out 1,200 kg, they're still in pretty good shape," the diplomat said.
The IAEA had no immediate comment to make on the deal, neither did the US, French and Russian missions to the agency.
But a French government spokesman said in Paris that Monday's accord does not resolve the underlying dispute between Iran and the West.
"The exchange of uranium that is envisaged amounts to a confidence gesture, a side issue," he told reporters.
Turkish Foreign Minister Ahmed Davutoglu said there was "no need" for further UN sanctions against Iran in the light of the deal.
"This agreement should be regarded positively and there is no need for sanctions now that we (Turkey and Brazil) have made guarantees and the low enriched uranium will remain in Turkey," he said.
"This agreement sends the international community a message that there is always room for diplomacy. Turkey and Brazil showed that it was time for diplomacy," he said.