Russia's announcement that fuel had been sent to the unfinished Bushehr power station marked a huge leap forward for Iran's nuclear ambitions, which Western and Israeli governments fear may mask a secret bomb-making project.

"On December 16, 2007, Atomstroiexport began delivery of the fuel for the initial installation at the future Bushehr power station," the state-run Russian corporation said in a statement.

The delivery process will take up to two months to complete, Atomstroiexport said, with the Russian-built station starting to generate electricity in approximately six months time.

Washington said the Russian shipments meant Iran now had less of an excuse not to halt uranium enrichment, as demanded by the United Nations. Enriched uranium is needed for nuclear power stations, but can, with further enrichment, be turned into bomb-making material.

"This fuel delivery provides Iran with one more reason to suspend their nuclear programme. If the Russians are providing the Iranians fuel, the Iranians have no reason to enrich uranium themselves," White House spokesman Gordon Johndroe said.

But Iran, which says it has no military ambitions and intends only to generate electricity, defiantly announced that enrichment work would go ahead.

The head of Iran's atomic energy organisation, Gholam Reza Aghazadeh, said more fuel was needed for a second power station now under construction.

"The fuel for this power station must come from Natanz," the site of Iran's uranium enrichment plant, he said.

Israel's strategic affairs minister, Avigdor Lieberman, said the insistence on developing more nuclear fuel meant "it is not meant for peaceful energy or nuclear industry."

"There is no explanation for the uranium enrichment other than a will to obtain a nuclear weapon," he charged.

US-led accusations that Iran is secretly building a nuclear weapon have long clouded Moscow's Bushehr project, which began in 1995.

Moscow has always rejected the claims and its position was bolstered earlier this month when the US intelligence community contradicted the White House by reporting that Iran had stopped a nuclear weapons drive in 2003.

The US report gave Russia its "final argument," Fyodor Lukyanov, at the journal Russia in Global Affairs, told AFP.

The Russian Foreign Ministry stressed in a statement that deliveries were made under control of the International Atomic Energy Agency (IAEA). It added that spent fuel from Bushehr would be "returned to Russia for reprocessing and storage" -- part of a plan to ensure that the fuel does not go astray.

IAEA officials monitored the sealing of the nuclear fuel two weeks ago at a factory in Novossibirsk ahead of the delivery.

"The Russian-Iranian cooperation on the Bushehr power station visibly demonstrates that one can effectively and reliably guarantee the realisation of national plans on developing the civilian atomic energy sector," the Foreign Ministry statement said.

In addition to rejecting US calls for the suspension of Bushehr, Moscow has also sold Iran anti-aircraft missiles and other high-tech weapons reportedly deployed by Iran's military in defence of nuclear installations.

Western powers, led by the United States, are pushing for a third UN sanctions resolution against Tehran to punish its refusal to suspend uranium enrichment.

However, the start of fuel deliveries makes that even less likely to happen, analysts said.

"Russia and China, which were already against sanctions, will now be even more confident," Lukyanov said.

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