By Agencies

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Iran and world powers have failed to resolve differences over the country's nuclear programme and agreed only to hold a technical follow-up meeting in Istanbul on July 3, according to the European Union foreign policy chief.

Catherine Ashton, who led the delegation representing the US, China, Russia, France, Britain and Germany at two days of talks in Moscow, said in Moscow on Tuesday that significant differences remained between the two sides.

"The choice is Iran's. We expect Iran to decide whether it is willing to make diplomacy work to focus on concrete confidence-building steps and to address the concerns of the international community," Ashton said after the close of the talks on Tuesday.

"But there's a very, very long way to go."

She also said the follow-up meeting would focus purely on technical details rather than broader political issues.

The six powers want Iran to stop enriching uranium to levels that bring it closer to acquiring weapons-grade material, but Iran has demanded relief from economic sanctions and an acknowledgement that it has the right to enrich uranium.

If negotiations fail to bring a solution, anxiety could grow on financial markets over the danger of higher oil prices and conflict in the Middle East as Israel has threatened to attack Iranian nuclear sites if diplomacy fails to stop Iran from getting the bomb, something Iran denies it is seeking.