Condoleezza Rice held out the prospect yesterday of direct talks with her Iranian counterpart this week in what would be America’s most significant contact with the Islamic republic since ties were severed almost 30 years ago.

The US Secretary of State was speaking shortly after Iran said that Manouchehr Mottaki, its Foreign Minister, would on Thursday attend talks in Egypt on the future of Iraq.

“I will not rule out that we may encounter one another,” Dr Rice said in a series of interviews with Sunday talk shows. “This isn’t an opportunity to talk about US-Iran issues. This is really an opportunity for all of Iraq’s neighbours to talk about how to stabilise Iraq.”

The State Department has been more forthcoming, saying that there is a strong likelihood of bilateral talks in Egypt.

Although Colin Powell, Dr Rice’s predecessor, found himself embarrassingly seated next to Iran’s Foreign Minister at a dinner in 2004, there has been no meaningful dialogue between the two nations since the US introduced sanctions after the storming and occupation of its embassy in Tehran by revolutionary students in November 1979. But President Bush has come under pressure to rekindle diplomacy from Democrats in Congress, the bi-partisan Iraq Study Group and allies such as Tony Blair.

Yesterday, asked what she would say to the Iranian Foreign Minister, Dr Rice provided a substantial agenda of items for discussion. “I think we want to talk about how we can all take actions, and Iraq’s neighbours can take actions, to help the Iraqis secure themselves,” she said.

Senior US and Iraqi officials have blamed Tehran for using its money and influence to arm and organise Shia militias inside Iraq, including those who have been attacking British troops in the south. Dr Rice said: “We need to stop the help to militias that then go out and kill innocent Iraqis.” But she ruled out talks on Iran’s nuclear programme, about which Mr Bush has said there will be no direct discussion until Tehran has suspended uranium enrichment activities.

Ali Larijani, the chief Iranian negotiator, arrived in Baghdad yesterday to discuss his country’s participation in the summit that is due to be held in the Egyptian Red Sea resort of Sharm el-Sheikh. It will be chaired by Nouri al-Maliki, the Iraqi Prime Minister, and Ban Ki Moon, the UN Secretary-General.

Fears that Iran would boycott this week’s conference had increased after claims that the US had gone back on a deal to release five Iranian detainees. But Dr Rice said that they would be “dealt with” through the normal process and there was “no guarantee” on their release.

Mr al-Maliki suggested to Mr Larijani yesterday that the persistent attacks in Iraq were also a threat to Iran. “Terrorist operations targeting Iraq will affect all countries in the world that are supposed to be supporting the US in its war against terrorism,” he said.

Dr Rice confirmed that the US would conduct an evaluation of the success of its surge strategy – and Iraq’s cooperation with it – in September, but insisted that this week Mr Bush would veto any congressional spending Bill that punished Mr al-Maliki’s Government for failing to meet benchmarks for progress.

— Faye Turney, one of the 15 Navy personnel and Marines seized by Iran last month and held for a fortnight, is thought to be returning to her ship. The MoD said that several sailors would return this week to HMS Cornwall in the Gulf.

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