UPDATE 2-Iran's rulers close ranks, raise pressure on Biden to lift sanctions
* State daily raps MPs over law against snap UN inspections
* Deal with IAEA to soften law creates window for diplomacy
* European powers urge Iran not to curb access for IAEA
* Iran gov't wants 2015 deal revived despite tough rhetoric
* Driven by crippling of Iran's economy under US sanctions (Adds European powers' appeal to Iran for maximum transparency)
DUBAI, Feb 23 (Reuters) - An Iranian state newspaper, taking aim at hardline lawmakers' intervention in Tehran's nuclear row with the West, warned on Tuesday that overly radical actions may lead to Iran's isolation after a new law ended snap inspections by U.N. inspectors.
Iran's 2015 nuclear deal with world powers has been fraying since 2018 when the United States pulled out and reimposed harsh sanctions on Tehran, prompting it to breach the deal's limits on uranium enrichment, a potential pathway to nuclear weapons.
On Monday, Iranian lawmakers protested against the government's decision to permit “necessary” monitoring by the International Atomic Energy Agency for up to three months, saying the move broke a new law they passed that mandated an end to IAEA snap inspections as of Tuesday.
Under the 2015 deal, Iran agreed to observe the IAEA's Additional Protocol that permits short-notice inspections at locations not declared to the agency - to bolster confidence that nuclear work is not being covertly put to military ends.
The three-month compromise secured by the IAEA's director-general on a trip to Tehran last weekend kept alive hopes for an eventual diplomatic solution to rescue the nuclear deal.
But the state newspaper Iran, seen as close to pragmatist President Hassan Rouhani, a former chief nuclear negotiator, suggested in an unusually critical commentary that the new law blocking snap inspections could be counter-productive.
"Those who say Iran must take swift tough action on the nuclear accord should say what guarantee there is that Iran will not be left alone as in the past..., and will this end anywhere other than helping build a consensus against Iran?" it said.
Later on Tuesday, the three major European parties to the nuclear deal called on Iran to cooperate fully with the IAEA and reverse steps that reduce transparency, saying its suspension of the Additional Protocol was deeply regrettable.
Both Tehran, whose economy has been crippled by sanctions, and new U.S. President Joe Biden's administration want to salvage the deal repudiated by his predecessor Donald Trump, but disagree over who should take the first step. Iran insists the United States must first lift sanctions, while Washington avers that Tehran must first return to compliance with the pact.
Since Trump's pull-out in 2018, Iran has been rebuilding stockpiles of low-enriched uranium, enriching it to higher levels of fissile purity and installing advanced centrifuges to speed up production.
HIGH-LEVEL SHOW OF UNITY
Biden's refusal to lift sanctions first has been met by a show of unity from both sides of Iran’s political divide, uniting hardliners who cast the United States as an implacable enemy with pragmatists who seek rapprochement with the West.
Supreme Leader Ayatollah Ali Khamenei, although the top hardliner with the last word on policy, endorsed the inspections deal with the IAEA in a tacit rebuff of hawkish lawmakers.
The hardline daily Kayhan, whose editor-in-chief is appointed by Khamenei, also approved it, saying the deal "could not have been prepared without the participation and opinion of the Supreme National Security Council."
But Iran's overall strategy appears to be cranking up enrichment and raising questions about cooperation with the IAEA to push the Biden administration into dropping the "maximum pressure" campaign of sanctions launched by Trump.
Khamenei, upping the ante on Monday, said Iran might enrich uranium up to 60% purity if needed, while repeating a denial of any Iranian intent to seek nuclear weapons, for which 90% enrichment would be required.
"Iran's economy is doing badly because of sanctions, COVID-19 crisis and mismanagement," said Meir Javedanefar, a lecturer at the Interdisciplinary Center Herzliya in Israel.
"Therefore, if Biden takes the first step by removing at least part of the sanctions..., Khamenei would be willing to reach a deal with him."
Washington, which said last week it was ready to talk to Tehran, said Khamenei's comments "sounds like a threat" but reiterated U.S. willingness to engage with Iran about returning to the 2015 nuclear deal.
Iran’s clerical rulers face challenges in keeping the economy afloat under U.S. sanctions that have slashed its vital oil exports.
The economic hardship bodes ill for the presidential election in June, when Iran’s rulers typically seek a high turnout to show their legitimacy, even if the outcome will not change any major policy that is decided by Khamenei. (Writing by Parisa Hafezi Editing by Mark Heinrich)
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