Iranian flag flies in front of the UN office building, housing IAEA headquarters, amid the coronavirus disease (COVID-19) pandemic, in Vienna, Austria, May 24, 2021.
Iranian flag flies in front of the UN office building, housing IAEA headquarters, amid the coronavirus disease (COVID-19) pandemic, in Vienna, Austria, May 24, 2021. Reuters / LISI NIESNER

There is little chance of the United States agreeing to remove Iran's elite security force from its list of foreign terrorist organisations any time soon, a French diplomatic source said on Thursday, casting a further pall over nuclear negotiations.

Talks to revive Iran's 2015 nuclear deal with world powers have been on hold since March, chiefly over Tehran's insistence that Washington remove the Islamic Revolutionary Guard Corps from the list.

"The negotiations are at a dead end," the source told reporters. "I am pessimistic on the possibility of resolving this subject quickly."

The broad outline of the deal that aims to revive the accord which restrains Iran's nuclear programme in return for relief from economic sanctions was essentially agreed in March.

However, it has since been thrown into disarray after last-minute Russian demands and the dispute over the U.S. Foreign Terrorist Organization list.

Western officials are largely losing hope that it can be resurrected, sources familiar with the matter said, forcing them to weigh how to limit Iran's atomic programme even as Russia's invasion of Ukraine has divided the big powers.

The EU's Iran nuclear talks coordinator, Enrique Mora, has been in Tehran this week in what has been described as the last chance to salvage the 2015 accord, which then U.S. President Donald Trump withdrew from in 2018.

"I think Iran would be committing a mistake by playing for time and thinking that the situation can remain static," the diplomatic source said, adding that the accord as such could not remain unchanged on the table indefinitely.

Western diplomats fear that the longer Iran continues developing its nuclear programme at the current pace, the less benefit there would be to returning to the deal.

"Today, there is still a use in returning to this accord, but that won't always be the case and political conditions in Tehran and elsewhere can also evolve," the diplomatic source said.

The source said Iran would be discussed at a meeting of a G7 foreign ministers in northern Germany on Saturday.